This case is certainly one of regulatory capture. I don't know when voluntary reporting started being considered regulation? Especially for an industry that we know is literally pouring toxic chemicals into the ground.
The Coase Theorem is neither efficient nor practical here because of the large number of people potentially affected by contamination, as well as the asymmetric information that the fracking industry has about the chemicals and practices that they are using. This case calls for strong government regulation to ensure safe fracking practices (or to determine if safe fracking practices are even possible). However to my knowledge the EPA has not really made any significant steps towards real regulation.
This case is certainly one of regulatory capture. I don't know when voluntary reporting started being considered regulation? Especially for an industry that we know is literally pouring toxic chemicals into the ground.
ReplyDeleteThe Coase Theorem is neither efficient nor practical here because of the large number of people potentially affected by contamination, as well as the asymmetric information that the fracking industry has about the chemicals and practices that they are using. This case calls for strong government regulation to ensure safe fracking practices (or to determine if safe fracking practices are even possible). However to my knowledge the EPA has not really made any significant steps towards real regulation.