Document Type

Working Paper

Publication Date

2019

College/Unit

College of Business and Economics

Document Number

19-02

Department/Program/Center

Economics

Abstract

A large body of literature finds that the energy sector is important to economic growth and development. The production of energy has negative environmental impacts, however, which has resulted in the sector being highly regulated. While several studies examine the effect of particular regulations on the energy sector, in this study we use the recently developed measure of regulation called RegData to estimate the impact of federal regulations on the energy sector. We employ a panel ARDL model to find an inverted U-shaped relationship between federal regulations and U.S. energy sector output. Federal regulations appear to increase energy sector outputs at low levels and then decline as regulations accumulate.

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