• Enforcement of environmental regulations matters for the effectiveness

(Duflo et al., 2018; Buntaine et al., 2022)

• Incentives of local regulators can be misaligned with environmental regulations

• Principal-agent problem

(Greenstone et al., 2022)

• Strategic responses from local regulators

(He et al., 2020; Zou, 2021; Xie and Yuan, 2023)

•  Heterogeneity in regulators

(Kahn et al., 2015; Fang et al., 2023)

• Open Questions

• How important is the role of local regulators on the effectiveness of environmental regulations?

• Do local regulators have private information to target ”right” firms or there is a misallocation in who to target?