The Effects of Municipal Policy on Green Building Designations in the United States

Abstract

This article describes the results of a quantitative examination of the effect of municipal policies on the number of commercial office buildings with a green building designation. Many states and cities have adopted green building requirements and incentives as policy instruments. During this study, an ordinary least square (OLS) regression analysis was conducted using American inner cities as a unit of analysis and coding municipal green building regulations and incentives as four separate dummy variables. The study also included four factors grouped by a factor analysis-supply-side factors, demand-side factors, air quality, and temperature-to control for external effects that can affect the decision to implement green building construction. The results indicate that, at the municipal level, regulatory policy has been a strong tool to promote green office building developments, as expected, but incentive-based policies have not been as effective, with the exception of administrative incentives.