Government regulations on health, safety and environment have been poppular blamed for the declining productivity in U.S. coal mines since 1970. The stagnation in the coal industry east of the Mississippi is alleged to have been caused by this declining productivity and by the growth of cheaper and cleaner coal production west of the Mississippi. Economic evidence suggests, however, that productivity declines were more due to a relative lowering of labor costs in comparison with coal prices and due to work stoppages. The development of western coals fields was spurred by growth in local demand and had only a relatively small impact on coal production east of the Mississippi. Problems of the eastern coal industry are rooted mainly in slow economic growth in eastern U.S. which must be addressed in the long-term interests of the eastern coal industry. ?? 1987.