Full Title: Institutional Choices for Regulating Oil and Gas Wells
Author(s): Lee Lane
Publisher(s): Hudson Institute
Publication Date: 2/2013
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The FRAC Act proposals raise a broader question. In the regulation of oil and gas development, what should be the proper division of labor between Washington and the states in limiting harmful environmental side-effects?
The answers to four questions will largely determine the division of labor that is most likely to maximize society’s welfare. First, do the environmental problems involve large trans-border effects? Second, would uniform standards protect large network or scale economies in the affected industry? Third, which level of government is likely to possess better information? Fourth, is the federal government more attentive to the public welfare than the states are?