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Accidents Waiting to Happen: Liability Policy and Toxic Pollution Releases

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  • Anna Alberini

    (University of Maryland)

  • David Austin

    (Resources for the Future)

Abstract

Proponents of environmental policies based on liability assert that strict liability imposed on polluters induces firms to handle hazardous wastes properly. We examine unintended pollution releases, relating them to the liability imposed on polluters by state mini-Superfund laws. We find that strict liability reduces the frequency and severity of pollution releases, but that its effects vary with firm size. Smaller firms are associated with more pollution releases in states with strict liability, suggesting that in these states smaller firms may have specialized in riskier production processes. Their number, however, has not necessarily grown in response to the state's liability policy. © 2002 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/003465302760556530
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Bibliographic Info

Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 84 (2002)
Issue (Month): 4 (November)
Pages: 729-741

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Handle: RePEc:tpr:restat:v:84:y:2002:i:4:p:729-741

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Web page: http://mitpress.mit.edu/journals/

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Citations

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Cited by:
  1. Hilary Sigman, 2010. "Environmental Liability and Redevelopment of Old Industrial Land," Journal of Law and Economics, University of Chicago Press, vol. 53(2), pages 289-306, 05.
  2. Vera Angelova & Olivier Armantier & Giuseppe Attanasi & Yolande Hiriart, 2013. "Relative Performance of Liability Rules: Experimental Evidence," Working Papers 2013-03, CRESE.
  3. van 't Veld, Klaas & Hutchinson, Emma, 2009. "Excessive spending by firms to avoid accidents: Is it a concern in practice?," International Review of Law and Economics, Elsevier, vol. 29(4), pages 324-335, December.
  4. Loureiro, Maria L., 2008. "Liability and food safety provision: Empirical evidence from the US," International Review of Law and Economics, Elsevier, vol. 28(3), pages 204-211, September.
  5. Alfred Endres & Tim Friehe, 2012. "Generalized Progress of Abatement Technology: Incentives Under Environmental Liability Law," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 53(1), pages 61-71, September.
  6. Wayne B. Gray & Jay P. Shimshack, 2011. "The Effectiveness of Environmental Monitoring and Enforcement: A Review of the Empirical Evidence," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 5(1), pages 3-24, Winter.
  7. Sheila M. Olmstead, 2010. "The Economics of Water Quality," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 4(1), pages 44-62, Winter.
  8. Kjetil Telle, 2012. "Monitoring and enforcement of environmental regulations. Lessons from a natural field experiment in Norway," Discussion Papers 680, Research Department of Statistics Norway.
  9. Telle, Kjetil, 2013. "Monitoring and enforcement of environmental regulations," Journal of Public Economics, Elsevier, vol. 99(C), pages 24-34.
  10. Guerrero, Santiago & Innes, Robert, 2008. "Statutory Rewards to Environmental Self-Auditing: Do They Reduce Pollution and Save Regulatory Costs? Evidence from a Cross-State Panel," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6204, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  11. Gonzalez, Fidel & Leipnik, Mark & Mazumder, Diya, 2013. "How much are urban residents in Mexico willing to pay for cleaner air?," Environment and Development Economics, Cambridge University Press, vol. 18(03), pages 354-379, June.

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