{"id":2167,"date":"2011-01-09T21:28:36","date_gmt":"2011-01-09T21:28:36","guid":{"rendered":"http:\/\/alexpfaff.com\/?post_type=research-paper&p=2167"},"modified":"2011-01-09T21:28:36","modified_gmt":"2011-01-09T21:28:36","slug":"can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks","status":"publish","type":"post","link":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/","title":{"rendered":"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks."},"content":{"rendered":"
Haitao Yin, Alexander Pfaff, Howard Kunreuther<\/div>\n
Risk Analysis 2011 volume 31 number 1: 12-24 (doi 10.1111\/j.1539-6924.2010.01479.x)<\/div>\n

\"PDF<\/a>Private risk reduction will be socially efficient only when firms are liable for all the damage that they cause. We find that environmental insurance can achieve social efficiency even when two traditional policy instruments\u2014ex post fines and risk management mandates with ex ante fines\u2014do not. Inefficiency occurs with ex post fines, when small firms declare bankruptcy and escape their liabilities, limiting the incentives from this policy tool. Firms ignore mandates to implement efficient risk management because regulatory agencies do not have sufficient resources to monitor every firm. The evolution of the U.S. Environmental Protection Agency\u2019s and states\u2019 underground storage tank programs suggests that mandating environmental insurance can address inefficiency due to small firms declaring bankruptcy. Comparing insurance mandates to risk management mandates, the burden on a regulator is lower if all it has to do is to confirm that the firm has insurance rather than that the firm has actually, and effectively, implemented required management practices. For underground storage tanks, we show that insurance lowered toxic releases.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Haitao Yin, Alexander Pfaff, Howard Kunreuther Risk Analysis 2011 volume 31 number 1: 12-24 (doi 10.1111\/j.1539-6924.2010.01479.x) Private risk reduction will be socially efficient only when firms are liable for all the damage that they cause. We find that environmental insurance can achieve social efficiency even when two traditional policy instruments\u2014ex post fines and risk management mandates with ex ante fines\u2014do not. Inefficiency occurs with ex post fines, when small firms declare bankruptcy and escape their liabilities, limiting the incentives from this policy tool. Firms ignore mandates to implement efficient risk management because regulatory agencies do not have sufficient resources to monitor every firm. The evolution of the U.S. Environmental Protection Agency\u2019s and states\u2019 underground storage tank programs suggests that mandating environmental insurance can address inefficiency due to small firms declaring bankruptcy. Comparing insurance mandates to risk management mandates, the burden on a regulator is lower if all it has to do is to confirm that the firm has insurance rather than that the firm has actually, and effectively, implemented required management practices. For underground storage tanks, we show that insurance lowered toxic releases.  <\/p>\n","protected":false},"author":37,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[14,47,38,48],"tags":[57,94,111,114,145,153],"class_list":["post-2167","post","type-post","status-publish","format-standard","hentry","category-14","category-theory","category-information-audits","category-united-states","tag-auditing","tag-fines","tag-information","tag-insurance","tag-risk","tag-storage-tanks","entry"],"yoast_head":"\nCan Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff\" \/>\n<meta property=\"og:url\" content=\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/\" \/>\n<meta property=\"og:site_name\" content=\"Alex Pfaff\" \/>\n<meta property=\"article:published_time\" content=\"2011-01-09T21:28:36+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png\" \/>\n<meta name=\"author\" content=\"Alex Pfaff\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Alex Pfaff\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/\",\"url\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/\",\"name\":\"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff\",\"isPartOf\":{\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png\",\"datePublished\":\"2011-01-09T21:28:36+00:00\",\"dateModified\":\"2011-01-09T21:28:36+00:00\",\"author\":{\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/4d3b58aaa9cabdc85658ebde818146f2\"},\"breadcrumb\":{\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage\",\"url\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png\",\"contentUrl\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png\",\"width\":50,\"height\":50,\"caption\":\"pdf link icon\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks.\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#website\",\"url\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/\",\"name\":\"Alex Pfaff\",\"description\":\"Sanford School Faculty\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/4d3b58aaa9cabdc85658ebde818146f2\",\"name\":\"Alex Pfaff\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/f3868c769fd39eb9a960e0878a71e12b?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/f3868c769fd39eb9a960e0878a71e12b?s=96&d=mm&r=g\",\"caption\":\"Alex Pfaff\"},\"url\":\"https:\/\/sites.sanford.duke.edu\/alexpfaff\/author\/asp9duke-edu\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/","og_locale":"en_US","og_type":"article","og_title":"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff","og_url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/","og_site_name":"Alex Pfaff","article_published_time":"2011-01-09T21:28:36+00:00","og_image":[{"url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png"}],"author":"Alex Pfaff","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Alex Pfaff","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/","url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/","name":"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks. - Alex Pfaff","isPartOf":{"@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#website"},"primaryImageOfPage":{"@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage"},"image":{"@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage"},"thumbnailUrl":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png","datePublished":"2011-01-09T21:28:36+00:00","dateModified":"2011-01-09T21:28:36+00:00","author":{"@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/4d3b58aaa9cabdc85658ebde818146f2"},"breadcrumb":{"@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#primaryimage","url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png","contentUrl":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-content\/uploads\/sites\/15\/2016\/06\/pdf-icon-50x50-1.png","width":50,"height":50,"caption":"pdf link icon"},{"@type":"BreadcrumbList","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/2011\/01\/09\/can-environmental-insurance-succeed-where-other-strategies-fail-the-case-of-underground-storage-tanks\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/"},{"@type":"ListItem","position":2,"name":"Can Environmental Insurance Succeed Where Other Strategies Fail? The case of underground storage tanks."}]},{"@type":"WebSite","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#website","url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/","name":"Alex Pfaff","description":"Sanford School Faculty","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/4d3b58aaa9cabdc85658ebde818146f2","name":"Alex Pfaff","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/f3868c769fd39eb9a960e0878a71e12b?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/f3868c769fd39eb9a960e0878a71e12b?s=96&d=mm&r=g","caption":"Alex Pfaff"},"url":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/author\/asp9duke-edu\/"}]}},"_links":{"self":[{"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/posts\/2167","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/users\/37"}],"replies":[{"embeddable":true,"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/comments?post=2167"}],"version-history":[{"count":0,"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/posts\/2167\/revisions"}],"wp:attachment":[{"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/media?parent=2167"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/categories?post=2167"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sites.sanford.duke.edu\/alexpfaff\/wp-json\/wp\/v2\/tags?post=2167"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}