Environmental Risk and Uncertainty: Insights from Yucca Mountain

Abstract

Abstract This study examines the effects of the risk from transporting high–level radioactive waste to the proposed Yucca Mountain repository on housing location decisions in Southern Nevada. Using data from a survey of southern Nevada households, we develop a model–based subjective risk estimate for each household. We then explore different factors that may influence the household's location decisions if the proposed transportation route is ultimately chosen for nuclear waste transport. We extend the conventional expected utility model to allow for uncertainty surrounding the actual risks borne by the household. Finally, we examine the impact of federal government compensation on households’ location decisions. The findings indicate that residents currently living near the proposed transportation route express subjective risk estimates much larger than those reported by the Department of Energy. In general, households that are uncertain about the future risks are more likely to relocate than those expressing certainty. When everything is considered, the model predicts that between one and three percent of households living near the transportation route are likely to relocate. Compensation can influence some households to remain at their present location and bear the transport risk.