Envelope Backs or the Gold Standard? Choosing the Accuracy of Damage Assessment Methods
AbstractGovernment trustees conduct natural resource damage assessments (NRDAs) to hold firms liable for damages caused by their pollution. We analyze a model in which a trustee chooses NRDA accuracy and a firm chooses precaution in response, where increased NRDA accuracy increases expense but decreases the chance that the firm evades damage payment. We find that optimal NRDA accuracy increases with the expected value of the damages. Other results help trustees design welfare-improving regimes to reduce damages from small spills, and identify policy changes and research that can increase social welfare in the NRD arena.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by University of Wisconsin Press in its journal Land Economics.
Volume (Year): 82 (2006)
Issue (Month): 3 ()
Contact details of provider:
Web page: http://le.uwpress.org/
Find related papers by JEL classification:
- Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Amy Ando & Wallapak Polasub, 2009. "The political economy of state-level adoption of natural resource damage programs," Journal of Regulatory Economics, Springer, vol. 35(3), pages 312-330, June.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.