While existing literatures have analyzed, in turn, the direct provision of environmental quality through basic environmental facilities as well as the enforcement of environmental regulations, we simultaneously analyze the impacts of both activities. We provide a model of an environmental regulatory agency that tries to minimize non-compliance by choosing a combination of enforcement parameters under the constraints of a level of basic environmental facilities and limited budget. An empirical analysis of the Korean experience demonstrates that an increase in basic treatment facilities investment led to a decrease in regulators' inspection efforts.

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