Revealed preferences of a state bureau: Case of New Mexico's underground storage tank program

Robert Berrens, Alok Bohara, Amy Baker and Ken Baker
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Amy Baker: Department of Economics, University of New Mexico, Postal: Department of Economics, University of New Mexico
Ken Baker: Department of Economics, University of New Mexico, Postal: Department of Economics, University of New Mexico

Journal of Policy Analysis and Management, 1999, vol. 18, issue 2, 303-326

Abstract: Leaking underground storage tanks (USTs) are a pervasive national environmental problem. Cleanup of leaking USTs is largely publicly financed and under the control of state agencies. In the transition to new compliance standards, individual states have taken advantage of provisions in federal regulations to implement their own programs. This raises the policy question of environmental federalism and the appropriate locus of government control. The objectives of this study are to examine the revealed preferences of a state UST bureau. New Mexico was one of the first state programs to use risk assessments in setting funding priorities. We analyze the statistical determinants of funding decisions and find strong evidence that risk information is used. Although our case study provides a measure of support for state control, the argument is strengthened if public financing is limited to the cleanup of historical pollution, rather than a means for providing insurance for prospective pollution. ©1999 by the Association for Public Policy Analysis and Management.

Date: 1999
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Persistent link: https://EconPapers.repec.org/RePEc:wly:jpamgt:v:18:y:1999:i:2:p:303-326

DOI: 10.1002/(SICI)1520-6688(199921)18:2<303::AID-PAM6>3.0.CO;2-F

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