Sharing the cost of cleaning up non-point source pollution

Sylvain Béal, David Lowing () and Léa Munich ()
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David Lowing: CentraleSupélec, LGI - Laboratoire Génie Industriel - CentraleSupélec - Université Paris-Saclay
Léa Munich: CRESE - Centre de REcherches sur les Stratégies Economiques (UR 3190) - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE], BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: We consider the problem of sharing the cost of cleaning the non-point source pollution of industrial sites among the firms that own these sites. The bilateral liabilities between firms are depicted by an undirected graph. We introduce and characterize axiomatically two allocation rules inspired by the celebrated Polluter pays and Beneficiary pays principles in environmental law. The first one shares evenly the cost of cleaning up a site among the firms that can have caused the corresponding environmental damage. The second one charges to each firm the entire cost of cleaning up its own production site. We also establish connections with cooperative game theory.

Keywords: Cooperative game theory; Cost allocation; Pollution; Liability (search for similar items in EconPapers)
Date: 2024-06
Note: View the original document on HAL open archive server: https://univ-fcomte.hal.science/hal-04634728v1
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Working Paper: Sharing the cost of cleaning up non-point source pollution (2024)
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