This dissertation applies economic theories and econometric methods to analyze the interactions between government policies and economic agents in two important and current topics: the protection of the environment and illegal migration.Following the introduction, the second chapter studies the empirical strength of bi-directional linkages between environmental standards and performance, on the one hand, and environmental innovation, on the other. Our empirical results reveal that environmental R&D both spurs the tightening of government environmental standards and is spurred by the anticipation of such tightening, suggesting that U.S. environmental policy (at least in the context of the manufacturing industries that we study) has been responsive to innovation and effective in inducing innovation.The third chapter studies whether a voluntary reduction pollution programs can prompt firms to develop new environmental technologies that yield future emission reduction benefits. Conversely, a VRP may induce a participating firm to divert resources from environmental research to environmental monitoring and compliance activities that yield short-term benefits in reduced emissions. We find evidence that higher rates of program participation are associated with significant reductions in the number of successful environmental patent applications four to six years after the program ended.The fourth chapter examines the migration duration of Mexican immigrants in the U.S. using data from the Mexican Migration Project (MMP). In the past, temporary migrations were frequent, and often the rule rather than the exception in the case of Mexican immigrants. This pattern may be changing due to the tightening of the border between Mexico and the Unites States. Moreover, this paper examines whether migration experience, demographic characteristics, economic conditions or social networks drive the time Mexican immigrants to reside illegally in the United States. The empirical analysis shows that the migration duration increases as the U.S. expected real wage increases. Tighter U.S. migration policies have an ambiguous effect on the migration duration while longer distances decrease the hazard of return to their state of origin.In the final chapter of this dissertation, the general findings are concluded and some future avenues of research are discussed.