Peer Effects in Voluntary Environmental Policies: An Application to Urban Water Quality

Daniel A. Brent; Douglas H. Wrenn; Gabriel R. Lara; Joseph Cook

doi:10.1086/739114

Peer Effects in Voluntary Environmental Policies: An Application to Urban Water Quality

Daniel A. Brent
, Douglas H. Wrenn
, Gabriel R. Lara
, Joseph Cook

Research output: Contribution to journal › Article › peer-review

Abstract

Stormwater runoff is a growing source of urban water pollution, costing cities billions of dollars. We investigate peer effects in a voluntary residential green stormwater infrastructure program that mitigates stormwater runoff. Our identification strategy exploits households’ relative position in eligible sewersheds that generates plausibly exogenous variation in eligible peers. Peer adoption causes a 0.2% increase in the annual adoption probability, a 66% increase relative to the mean. According to our calculations, the policy reduced compliance costs by $85–$235 million for the Seattle metropolitan area, of which roughly 40% is due to peer effects.

Original language	English (US)
Pages (from-to)	533-574
Number of pages	42
Journal	Journal of the Association of Environmental and Resource Economists
Volume	13
Issue number	2
DOIs	https://doi.org/10.1086/739114
State	Published - Mar 2026

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 11 Sustainable Cities and Communities

All Science Journal Classification (ASJC) codes

Economics and Econometrics
Nature and Landscape Conservation
Management, Monitoring, Policy and Law

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10.1086/739114

Cite this

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title = "Peer Effects in Voluntary Environmental Policies: An Application to Urban Water Quality",

abstract = "Stormwater runoff is a growing source of urban water pollution, costing cities billions of dollars. We investigate peer effects in a voluntary residential green stormwater infrastructure program that mitigates stormwater runoff. Our identification strategy exploits households{\textquoteright} relative position in eligible sewersheds that generates plausibly exogenous variation in eligible peers. Peer adoption causes a 0.2\% increase in the annual adoption probability, a 66\% increase relative to the mean. According to our calculations, the policy reduced compliance costs by \$85{\textendash}\$235 million for the Seattle metropolitan area, of which roughly 40\% is due to peer effects.",

author = "Brent, \{Daniel A.\} and Wrenn, \{Douglas H.\} and Lara, \{Gabriel R.\} and Joseph Cook",

note = "Publisher Copyright: {\textcopyright} 2026 Association of Environmental and Resource Economists. All rights reserved, including rights for text and data mining and training of artificial intelligence technologies or similar technologies. Published by The University of Chicago Press for The Association of Environmental and Resource Economists.",

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doi = "10.1086/739114",

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AU - Brent, Daniel A.

AU - Wrenn, Douglas H.

AU - Lara, Gabriel R.

AU - Cook, Joseph

N1 - Publisher Copyright: © 2026 Association of Environmental and Resource Economists. All rights reserved, including rights for text and data mining and training of artificial intelligence technologies or similar technologies. Published by The University of Chicago Press for The Association of Environmental and Resource Economists.

PY - 2026/3

Y1 - 2026/3

N2 - Stormwater runoff is a growing source of urban water pollution, costing cities billions of dollars. We investigate peer effects in a voluntary residential green stormwater infrastructure program that mitigates stormwater runoff. Our identification strategy exploits households’ relative position in eligible sewersheds that generates plausibly exogenous variation in eligible peers. Peer adoption causes a 0.2% increase in the annual adoption probability, a 66% increase relative to the mean. According to our calculations, the policy reduced compliance costs by $85–$235 million for the Seattle metropolitan area, of which roughly 40% is due to peer effects.

AB - Stormwater runoff is a growing source of urban water pollution, costing cities billions of dollars. We investigate peer effects in a voluntary residential green stormwater infrastructure program that mitigates stormwater runoff. Our identification strategy exploits households’ relative position in eligible sewersheds that generates plausibly exogenous variation in eligible peers. Peer adoption causes a 0.2% increase in the annual adoption probability, a 66% increase relative to the mean. According to our calculations, the policy reduced compliance costs by $85–$235 million for the Seattle metropolitan area, of which roughly 40% is due to peer effects.

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JF - Journal of the Association of Environmental and Resource Economists

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ER -

Peer Effects in Voluntary Environmental Policies: An Application to Urban Water Quality

Abstract

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