Information Asymmetries, Uncertainties, and Cleanup Delays at Superfund Sites

Gordon C. Rausser, Leo K. Simon () and Jinhua Zhao ()

Staff General Research Papers from Iowa State University, Department of Economics

Abstract: Superfund cleanup has been extremely slow. Traditional analysis has centered around reducing negotiation and litigation to expedite the cleanup process. We investigate other factors which provide possible incentives for delay, namely, discounting, risk aversion, and compensation for off-site damage. We find that liability share plays an essential role in PRPs' incentives to delay. Commonly adopted EPA strategies, such as negotiating with PRP steering committees and buying outde minimisPRPs, may also lead to delay. The paper also designs a Bayesian mechanism for information extraction, and finds that the lump-sum transfer mechanism is not always efficient.

Date: 1998-01-01
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Published in Journal of Environmental Economics and Management, January 1998, vol. 35 no. 1, pp. 48-68

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Journal Article: Information Asymmetries, Uncertainties, and Cleanup Delays at Superfund Sites (1998)
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Persistent link: http://EconPapers.repec.org/RePEc:isu:genres:1256

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