THE DETERMINANTS OF HAZARDOUS WASTE DISPOSAL CHOICE: AN EMPIRICAL ANALYSIS OF HALOGENATED SOLVENT WASTE SHIPMENTS

Disposal of hazardous waste is more complex than simply choosing the option with the lowest price: Legislation may hold a waste generator responsible for cleaning up a badly contaminated waste disposal site if the operator of that site goes bankrupt. This paper estimates conditional logit models of a generator's choice of waste management facility (TSDF) for shipments of halogenated solvent waste originating in California in 1995. The probability that a facility is selected as the destination of a shipment depends on the cost of shipping to and disposal at the facility, on existing contamination at the site, and on the track record of the facility, suggesting that generators do seem to balance current disposal costs with the likelihood of future liability. There is no evidence that generators prefer facilities owned by publicly traded firms, but when generators do choose TSDFs belonging to a publicly traded company, they prefer wealthier companies. (JEL Q21)