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

Author

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  • Robert P. Berrens

    (Department of Economics, University of New Mexico)

  • Alok K. Bohara

    (Department of Economics, University of New Mexico)

  • Amy Baker

    (Department of Economics, University of New Mexico)

  • Ken Baker

    (Department of Economics, University of New Mexico)

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.

Suggested Citation

  • Robert P. Berrens & Alok K. Bohara & Amy Baker & Ken Baker, 1999. "Revealed preferences of a state bureau: Case of New Mexico's underground storage tank program," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 18(2), pages 303-326.
    • Handle: 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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    References listed on IDEAS

    as
    1. Boyd, James & Kunreuther, Howard, 1995. "Retroactive Liability and Future Risk: The Optimal Regulation of Underground Storage Tanks," Discussion Papers 10768, Resources for the Future.
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    6. Shreekant Gupta & George Van Houtven & Maureen Cropper, 1996. "Paying for Permanence: An Economic Analysis of EPA's Cleanup Decisions at Superfund Sites," RAND Journal of Economics, The RAND Corporation, vol. 27(3), pages 563-582, Autumn.
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    Cited by:

    1. Andrew B. Whitford, 2007. "Competing Explanations for Bureaucratic Preferences," Journal of Theoretical Politics, , vol. 19(3), pages 219-247, July.

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