Social capital and carcinogenic waste releases

We examine the role of social capital in explaining the highly unequal regional distribution of carcinogenic waste releases in the US. Our model suggests that social capital, by enabling information sharing and coordination among community members, decreases firms’ toxic releases. Our empirical analysis is based on county-level toxic releases derived from around 2 million facility-level reports during 1998-2019. In addition to panel data fixed-effect regressions and hurdle models, we utilize instrumental variable (IV) approach to establish a causal link between social capital and county-level carcinogenic releases. We show that social capital reduces carcinogenic releases. However, this favorable impact of social capital is reduced when counties rely heavily on waste-releasing firms for employment and economic opportunities. An important policy implication of our study is that the efficacy of initiatives such as the Environmental Protection Agency’s Emergency Planning and Community Right-to-Know Act to eliminate environmental injustice is likely to depend on the social capital of communities.