KAIST (President Choongsik Bae) announced on the 26th of July that a joint research team led by Professor Narae Lee from The School of Business and Technology Management at KAIST, in collaboration with Professor Heli Wang from Singapore Management University (SMU), analyzed immigration-related legislation and environmental data across the United States and found that when immigration becomes a central political agenda, government environmental oversight weakens and firms' toxic chemical releases increase. The research team describes this phenomenon as "institutional crowding."
Government administrative capacity and budgets are not unlimited. When a new political issue emerges, government attention and resources become concentrated in that area. In the process, enforcement in relatively less visible policy areas, such as environmental oversight, may weaken. Although the research team analyzed immigration as a case study, they explain that this phenomenon is not limited to a specific issue. Rather, it represents a general mechanism that can arise when political agendas compete for limited government resources.
The research team combined data from the U.S. Environmental Protection Agency's Toxics Release Inventory (TRI) with immigration-related legislative data from U.S. states. By analyzing a total of 82,377 observations collected from 14,390 manufacturing facilities across the United States between 2010 and 2018, the team found that each additional immigration-related bill was associated with an average increase of about 1% in toxic chemical releases per manufacturing facility. This is equivalent to approximately 25 kilograms, or 56 pounds, of additional toxic emissions per facility.
The researchers found that this increase was not caused by a relaxation of environmental regulatory standards. Rather, it occurred because firms reduced costly efforts to cut pollution and treat toxic waste as government environmental oversight became relatively less effective.
This pattern was especially pronounced in states facing fiscal constraints. In states with high debt or heavy fiscal burdens, environmental oversight weakened further when political attention shifted to new issues. This suggests that when government budgets are tight, resources are more likely to be allocated first to politically urgent issues, while environmental monitoring may be pushed down the priority list.
Professor Narae Lee said, "This study does not argue that immigration causes environmental pollution. Rather, it shows that shifts in the political agenda item can weaken environmental oversight and thereby increase corporate pollution," adding, "Even when limited government resources are concentrated on a particular issue, environmental oversight needs to be institutionally protected so that it remains stable."
The study is significant in that it empirically identifies how competition among political agendas can affect firms' environmental pollution management. It also offers new implications for public policy and for advancing environmental justice, so that the burden of environmental pollution does not fall disproportionately on socially vulnerable groups.
The research was published online on May 29 in the Journal of Management, a leading international journal in the field of management, with Professor Narae Lee as the first author.
An earlier version of the paper received the POSCO Corporate Citizenship Research Award, the Robert J. Litschert Award from the Academy of Management, and the Best Paper with Practical Implications Award from the Strategic Management Society, recognizing the excellence and practical significance of the research.
※ Paper title: There's More Than Meets the Eye: Assessing the Impact of Immigrants on Firm Environmental Performance, DOI: https://doi.org/10.1177/01492063261442451
