The Effect of Joint and Several Liability Under Superfund on Brownfields

45 Pages Posted: 20 Sep 2005

See all articles by Howard F. Chang

Howard F. Chang

University of Pennsylvania Law School

Hilary Sigman

Rutgers University - Department of Economics; National Bureau of Economic Research (NBER)

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In response to claims that the threat of environmental liability under the Superfund law deters the acquisition of potentially contaminated sites (or brownfields) for redevelopment, the federal government has adopted programs to protect purchasers from liability. This protection may be unwarranted, however, if sellers can simply adjust property prices downward to compensate buyers for this liability. We present a model of joint and several liability under Superfund that allows us to distinguish four different reasons that this liability may discourage the purchase of brownfields. The previous literature has overlooked the effects that we identify, which all arise because a sale may increase the number of defendants in a suit to recover cleanup costs. Our analysis suggests that the brownfields problem may be more widespread than one might infer from the prior literature. Furthermore, the effects that we identify may distort not only the incentives to sell property subject to Superfund liability but also any decision of any party subject to any joint and several liability if that decision could affect the number of other defendants liable for the same harm.

Keywords: environmental law and policy, environmental economics, Superfund liability, torts, real estate

JEL Classification: K32, Q5, R3

Suggested Citation

Chang, Howard F. and Sigman, Hilary A., The Effect of Joint and Several Liability Under Superfund on Brownfields. U of Penn, Inst for Law & Econ Research Paper No. 05-21, U of Penn Law School, Public Law Working Paper No. 06-18, International Review of Law and Economics, Vol. 27, 2007, Available at SSRN:

Howard F. Chang (Contact Author)

University of Pennsylvania Law School ( email )

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Philadelphia, PA 19104
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215-898-9497 (Phone)
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Hilary A. Sigman

Rutgers University - Department of Economics ( email )

75 Hamilton Street
New Brunswick, NJ 08901
United States


National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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