9311881 Henderson The purpose of this research is to analyze the impact of air quality regulation between 1970 and 1987 on (1) urban location and productivity for a variety of manufacturing industries, and on (2) air quality across metropolitan areas and between central cities and suburbs. Equations for 1987 concerning location, employment growth, and productivity will be estimated directly, based upon current and historical industrial environments and regulation, accounting for issues of simultaneity, censoring, and selectivity. While regulation in non-attainment areas may have resulted in a reallocation of industrial activity across metropolitan areas, with corresponding productivity gains and losses, improved environmental quality in non-attainment areas has positive impact for industry through lower wages. Hedonic wage functions capturing the link between air quality and wages will be estimated, accounting for issues of simultaneity and joint wage-land rent determination. This project is important because it will shed new light on the economic effects and impact on urban air quality of air pollution regulations. ***
