TY  - JOUR
AU  - Fullerton,Don
AU  - Tsang,Seng-Su
TI  - Environmental Costs Paid by the Polluter or the Beneficiary? The Case of CERCLA and Superfund
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4418
PY  - 1993
Y2  - August 1993
UR  - http://www.nber.org/papers/w4418
L1  - http://www.nber.org/papers/w4418.pdf
N1  - Author contact info:
Don Fullerton
Department of Finance
University of Illinois
BIF Box#30 (MC520)
515 East Gregory Drive
Champaign, IL  61820
Tel: 217/244-3621
Fax: 217/244-3102
E-Mail: dfullert@illinois.edu
AB  - The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) of 1980 follows the "polluter pays" principle by placing retroactive liability on responsible firms. Yet this cost is borne by current shareholders who did not benefit from past low-cost waste management. This paper introduces a "beneficiary pays" principle that burdens consumers who benefited from lower prices. An input-output model is developed to calculate the effects of alternative tax rules on output prices. We find: (1) that the increase in commodity prices contributed by current Superfund taxes is only a small fraction of the price increase that would have fully covered the cost of controlling hazardous waste; and (2) current Superfund taxes do not raise the prices of goods associated with the most pollution.
ER  -