“…This demand-side leakage has received noticeably less attention in the environmental economics literature (see Bushnell, Peterman, and Wolfram 2008), but has a long history in other fields of economics. A wide range of examples include the smuggling of alcohol and tobacco across state borders, the effects of differential drinking laws on traffic fatalities, cross-border food purchases, the effects of state taxes on online purchases, and state lotteries (e.g., Baltagi and Goel 1987;Thursby and Thursby 2000;Stehr 2007;Tosun and Skidmore 2007;Adams and Cotti 2008;Goolsbee, Lovenheim, and Slemrod 2010;Lovenheim and Slemrod 2010;Knight and Schiff 2012;Einav, Knoepfle, Levin, and Sundaresan 2014). This paper also contributes to the literature on wastewater treatment facility behavior and the impact of regulations on these facilities (e.g., Earnhart 2004Earnhart , 2007Shimshack andWard, 2005, 2008;Chakraborti and McConnell, 2012).…”