The Denver Arsenal: A Market-Based Solution To Environmental Externalities Management

Abstract

This paper aims to analyze the experience of the Rocky Mountain Arsenal (RMA) zone in the city of Denver, Colorado, trough the scope of the most accepted theories of economic regulation for reducing negative externalities caused by environmental contamination or for conducing them to a social desirable level. At first the facts of what happened in the RMA will be described, starting from the period where it used to be a military and agrochemical factory trough the expedition of The Arsenal Act as the result of a contract between environmental agencies and pollutants. Then, economic regulation theories will be analyzed, especially, the market based Austrian perspective, its advantages and difficulties and the relation with occurred in the Arsenal zone.