Political Economy of Mining Reclamation

Jessi L. Troyan

Major Professor: Thomas Stratmann, PhD, Department of Economics

Committee Members: Christopher J. Coyne, Noel Johnson

Buchanan Hall (formerly Mason Hall), #D180
October 31, 2017, 11:00 AM to 01:00 PM


In this dissertation, I explore the origins of the largest piece of federal surface mining regulation, the Surface Mining Control and Reclamation Act of 1977 (SMCRA), and the implementations and effects of associated programs that arise from it.  

The first chapter explores the origins of SMCRA and the manner in which it was ultimately implemented through the economics of regulation, and more specifically a Baptists and bootleggers framework. I argue that a coalition of strange bedfellows involving eastern environmentalists, the United Mine Workers Union, and western coal interests coalesced to raise the cost of mining coal through surface extraction methods through the key SMCRA provision to restore the land to “approximate original contour,” or in less technical terms – rebuild the mountain. An optimal storm of natural conditions such as coal quality and topography combined with policy imperatives surrounding the energy crises of the 1970s, the growing environmentalism movement, increased production and demand for western coal, and the consequences of other environmental regulation in that era allowed for the coalition to take hold.  

The second chapter explores a broader question of what factors determine federal spending on environmental goods. More specifically, is the severity of the hazard the only metric of consideration, or do other factors play a role in explaining spending?  Here, I explore the extent to which political factors, as well as environmental and health factors, influence the disbursement of monies from the Abandoned Mine Land Fund (AMLF) that was created within the SMCRA legislation. Results here suggest that mixes of public and political interest influences are present in disbursement decisions throughout the span of the program, and that political influences gain explanatory strength as the funding structure of AMLF is politically altered.  

The third chapter asks the questions: What effects do government facilitated environmental remediation programs have on local economies? Are there positive economic effects such as increased population, income, or labor force participants? Do these kinds of projects decrease unemployment rates? Or, in the end, do these programs serve mostly to confer psychic benefits to individuals with preferences for a more natural or undisturbed surrounding environment? I empirically explore those questions within the context of federally funded reclamation of abandoned mine sites, at the county level, in West Virginia. The findings suggest that the economic effects, if any, are negative, especially in terms of changes in population and per capita income.