Since the Treaty on the Nonproliferation of Nuclear Weapons entered into force in 1970, the peaceful uses of nuclear technology in electricity generation and medicine have been incorporated into international markets. However, nuclear markets are imperfect. This paper focuses on the properties of the nuclear industry that lead to “market failure”, where markets do not necessarily result in socially efficient outcomes. These properties in the production or consumption of a good or service are (1) public goods, such as advances in science; (2) positive or negative externalities, such as nuclear weapons technology proliferation; (3) asymmetric information and uncertainty, where an insurer or financier cannot determine whether the client is acting with due care and due diligence; and (4) increasing returns to scale, such that a “natural” monopoly could be established. Because of these properties, the nuclear industry is a quintessential “publick institution” providing “publick works”, as identified by Adam Smith in 1776. Furthermore, exploding demand for non-fossil generated electricity and declining access to medical radioisotopes requires a review of the public-private boundaries in international nuclear markets while continuing to uphold nonproliferation standards. For these standards to be effective, every nation and firm must adhere to nonproliferation agreements.
AJLabs (2023). Visualising the 2,056 Nuclear Tests Conducted since 1945 . Aljazeera. https://www.aljazeera.com/news/longform/2023/8/29/visualising-the-2056-nuclear-tests-conducted-since-1945
Aoki, M., & Rothwell, G. (2013). A Comparative Institutional Analysis of the Fukushima Nuclear Disaster: Lessons and Policy Implications. Energy Policy, 53, 240-247. https://doi.org/10.1016/j.enpol.2012.10.058
Arrow, K. (1951). Social Choice and Individual Values . Cowles Foundation for Research in Economics, Yale University (Reprinted 1963 and 2012). https://cowles.yale.edu/research/cfm-121-social-choice-and-individual-values-1st-ed
Brady, M. E. (2015). Adam Smith, Not J M Keynes or Frank Knight, Was the First Scholar to Make the Uncertainty—Risk Distinction Explicitly and Apply It Rigorously. Scholedge International Journal of Management & Development, 2, 24. https://doi.org/10.19085/sijmd.020903
Cabrera-Palmer, B., & Rothwell, G. (2008). Why Is Brazil Enriching Uranium? Energy Policy, 36, 2570-2577. https://doi.org/10.1016/j.enpol.2008.02.033
Coase, R. H. (1960). The Problem of Social Cost. The Journal of Law and Economics, 3, 1-44. https://doi.org/10.1086/466560
Cooper, M. (2017). A Dozen Reasons for the Economic Failure of Nuclear Power . Bulletin of the Atomic Scientists (October 17). https://thebulletin.org/2017/10/a-dozen-reasons-for-the-economic-failure-of-nuclear-power/
Cowan, R. (1990). Nuclear Power Reactors: A Study in Technological Lock-In. The Journal of Economic History, 50, 541-567. https://doi.org/10.1017/s0022050700037153
Cupitt, R. (2021). Undermining Efforts to Prevent the Proliferation of Weapons of Mass Destruction: International Governance on the Cheap . The Henry L. Stimson Center. https://www.stimson.org/2021/undermining-efforts-to-prevent-the-proliferation-of-weapons-of-mass-destruction-international-governance-on-the-cheap/
Dalrymple, D. (2003). Scientific Knowledge as a Global Public Good: Contributions to Innovation and the Economy. In The Role of Scientific and Technical Data and Information in the Public Domain: Proceedings of a Symposium , pp. 35-51. National Academies Press. https://www.ncbi.nlm.nih.gov/books/NBK221876/
Daton, D. (2024). US/DOE Offers Six Companies Contracts to Produce Domestic Uranium Fuel for Nuclear Plants . NUCNET. https://www.nucnet.org/news/doe-offers-six-companies-contracts-to-produce-domestic-uranium-fuel-for-nuclear-plants-12-3-2024
Eisenhower, D. D. (1953). Eisenhower’s “ Atoms for Peace ” : The Speech that Inspired the Creation of the IAEA . International Atomic Energy Agency. https://www.iaea.org/sites/default/files/publications/magazines/bulletin/bull54-4/54401210304.pdf
ElBaradei, M. (2005). The Enduring Lessons of Chernobyl . International Atomic Energy Agency. https://www.iaea.org/newscenter/statements/enduring-lessons-chernobyl
Enia, J. (2020). Greasing the Wheels of the Nuclear Nonproliferation Regime: The Political Economy of Nuclear Suppliers Group Rules. Journal for Peace and Nuclear Disarmament, 3, 385-397. https://doi.org/10.1080/25751654.2020.1856553
Fork, W. E., & Fowler, W. E. (2022). Sixth and Eighth Circuits Confirm the Broad Applicability of the Price-Anderson Nuclear Industries Indemnity Act . Pillsbury. https://www.pillsburylaw.com/en/news-and-insights/matthews-cotter-price-anderson-act.html
General Atomics (2024). History . https://www.ga.com/about/history
IAEA (2024a). Power Reactor Information System (PRIS) . International Atomic Energy Agency. https://www.iaea.org/resources/databases/power-reactor-information-system-pris
IAEA (2024b). IAEA Safeguards Overview: Comprehensive Safeguards Agreements and Additional Protocols . International Atomic Energy Agency. https://www.iaea.org/topics/safeguards-agreements
ICJ (International Court of Justice) (1996). Legality of the Threat or Use of Nuclear Weapons . ICJ Advisory Opinion. https://www.icj-cij.org/case/95
IEA (International Energy Agency) (2024). Global Conference on Energy & AI Conference . OECD. https://www.iea.org/events/global-conference-on-energy-ai
Joerges, C. (2012). The Timeliness of Direct Democracy in the Eu—The Example of Nuclear Energy in the EU and the Institutionalisation of the European Citizens’ Initiative in the Lisbon Treaty. Beijing Law Review, 3, 1-6. https://doi.org/10.4236/blr.2012.31001
Kimani, A. (2024). Banks Unwilling to Finance $5 Trillion Global Nuclear Development . https://oilprice.com/Alternative-Energy/Nuclear-Power/Banks-Unwill-ing-To-Finance-5-Trillion-Global-Nuclear-Development.html
Kindleberger, C. (1986). International Public Good without International Government. American Economic Review , 76 , 1-13. https://www.jstor.org/stable/1804123
Leary, T. B. (2001). The Need for Objective and Predictable Standards in the Law of Pre-dation . The Steptoe & Johnson and Analysis Group/Economics 2001 Antitrust Conference . Federal Trade Commission. https://www.ftc.gov/news-events/news/speeches/need-objective-predictable-standards-law-predation
Lewin Sime, R. (1998). Lise Meitner and the Discovery of Nuclear Fission. Scientific American, 278, 80-85. https://doi.org/10.1038/scientificamerican0198-80
Mannully, Y. (2008). U.S.-India Nuclear Cooperation and Non-Proliferation . Nuclear Law Bulletin, 2008/2.
McDermott, W., & McDermott, E. (2017). Third Circuit Judge Blocks Merger of Nuclear Waste Disposal Companies Rejecting “ Failing Firm’ Defense ” . McDermott Antitrust Alert. https://natlawreview.com/article/third-circuit-judge-blocks-merger-nuclear-waste-disposal-companies-rejecting-failing
Moffatt, M. J. (2019). In Search of the Elusive Conflict: The (In-)compatibility of the Treaties of the Non-Proliferation and Prohibition of Nuclear Weapons . Nuclear Law Bulletin No. 102, Nuclear Energy Agency, OECD. https://www.oecd-nea.org/jcms/pl_25550/nuclear-law-bulletin-no-102
NASEM (National Academies of Science, Engineering, and Medicine) (2007). Review of DOE’s Nuclear Energy Research and Development Program . National Research Council. https://nap.nationalacademies.org/catalog/11998/review-of-does-nuclear-energy-research-and-development-program
NEA (Nuclear Energy Agency) (2004). Government and Nuclear Energy . Nuclear Energy Agency, Organisation for Economic Cooperation and Development. https://www.oecd.org/en/publications/government-and-nuclear-energy_9789264015401-en.html
NEA (Nuclear Energy Agency) (2008). Market Competition in the Nuclear Power Indus-try . Organisation for Economic Cooperation and Development. https://www.oecd-nea.org/upload/docs/application/pdf/2019-12/6246-market-competition.pdf
NEA (Nuclear Energy Agency) (2016). The Costs of Nuclear Power Plant Decommissioning . Organisation for Economic Cooperation and Development. https://www.oecd-nea.org/jcms/pl_14910/costs-of-decommissioning-nuclear-power-plants?details=true
NEA (Nuclear Energy Agency) (2019). The Supply of Medical Isotopes: An Economic Diagnosis and Possible Solutions . Organisation for Economic Cooperation and Development.
NEA/IAEA (Nuclear Energy Agency/International Atomic Energy Agency) (2018). Measuring Employment Generated by the Nuclear Power Sector . Nuclear Development Division, NEA, OECD. https://www.oecd-nea.org/jcms/pl_14912/measuring-employment-generated-by-the-nuclear-power-sector?details=true
NRRI (National Regulatory Research Institute) (1993). A Synopsis of the Energy Policy Act of 1992: New Tasks for State Public Utility Commissions . https://ipu.msu.edu/wp-content/uploads/2016/12/Costello-Energy-Policy-Act-93-7-June-93-1.pdf
Pasqualetti, M. J., & Rothwell, G. S. (1993). Nuclear Decommissioning Externalities and the Coase Theorem. Public Utilities Fortnightly, 131 , 35-37. https://www.researchgate.net/publication/265599276_Nuclear_Decommissioning_Externalities_and_the_Coase_Theorum
Radavoi, C. N., & Bian, Y. (2014). Why China Should Regulate Its Overseas Investors’ Environmental Behavior. Beijing Law Review, 5, 22-33. https://doi.org/10.4236/blr.2014.51003
Rothwell, G. (1980). Market Coordination by the Uranium Oxide Industry. The Antitrust Bulletin, 25, 233-268. https://doi.org/10.1177/0003603x8002500108
Rothwell, G. (2009). Market Power in Uranium Enrichment. Science & Global Security, 17, 132-154. https://doi.org/10.1080/08929880903423586
Rothwell, G. (2010). International Light Water Nuclear Fuel Fabrication Supply: Are Fabrication Services Assured? Energy Economics, 32, 538-544. https://doi.org/10.1016/j.eneco.2009.08.012
Rothwell, G. (2021). Spent Nuclear Fuel Storage: What Are the Relationships between Size and Cost of the Alternatives? Energy Policy, 150, Article ID: 112126. https://doi.org/10.1016/j.enpol.2020.112126
Rothwell, G. (2022). Projected Electricity Costs in International Nuclear Power Markets. Energy Policy, 164, Article ID: 112905. https://doi.org/10.1016/j.enpol.2022.112905
Rothwell, G. (2024). Can the European Nuclear Power Industry Compete with the Chinese Nuclear Power Industry? Journal of Infrastructure, Policy and Development, 8, Article No. 8715. https://doi.org/10.24294/jipd.v8i11.8715
Rothwell, G. S. (2016). Economics of Nuclear Power . Routledge, Francis and Taylor Group. https://www.academia.edu/37151189/The_Economics_of_Future_Nuclear_Power
Rothwell, G. S., & Gómez, T. (2003). Electricity Economics: Regulation and Deregulation . IEEE Press with John Wiley & Sons Publication. https://www.researchgate.net/publication/4377801_Electricity_Economics_Regulation_and_Deregulation
Rothwell, G. S., & Wood, T. (2024). Middle Eastern Nuclear Fuel Services Collaboration. In Regional Workshop on Nuclear Energy and Nonproliferation: Insights, Policy Recommendations, and Featured Papers (NTI-ENEC 2024 ) (pp. 6-34). Nuclear Threat Initiative. https://www.nti.org/analysis/articles/2023-regional-workshop-on-nuclear-energy-and-nonproliferation-insights-policy-recommendations-and-featured-papers/
Saab, N. (2022). The Polluter Pays, a Pillar Principle of Stockholm . Green Policy Platform. https://www.greenpolicyplatform.org/blog/polluter-pays-pillar-principle-stockholm
Samuelson, P. A. (1954). The Pure Theory of Public Expenditure. The Review of Economics and Statistics, 36, 387-389. https://doi.org/10.2307/1925895
SEP (Stanford Encyclopedia of Philosophy) (2021). Public Goods . Stanford University. https://plato.stanford.edu/entries/public-goods/
Seward, A. M., Wood, T. W., Gitau, E. T., & Ford, B. E. (2013). Supply Security in Future Nuclear Fuel Markets . Pacific Northwest National Laboratory-22971. https://www.pnnl.gov/main/publications/external/technical_reports/PNNL-22971.pdf
Sidley (2024). Congress Passes ADVANCE Act to Facilitate U.S. Development of Advanced Nuclear Reactors . Sidley. https://www.sidley.com/en/insights/newsupdates/2024/06/congress-passes-advance-act-to-facilitate-us-development-of-advanced-nuclear-reactors
Simeone, C. (2017). Let’s Talk Government Ownership of Unprofitable Nuclear Power Plants . Kleinman Center for Energy Policy, University of Pennsylvania. https://kleinmanenergy.upenn.edu/news-insights/lets-talk-government-ownership-of-unprofitable-nuclear-power-plants/
Smith, A. (1763). Lectures on Jurisprudence, Glasgow Edition of the Works and Correspondence, Vol. 5 . Liberty Fund. https://competitionandappropriation.econ.ucla.edu/wp-content/uploads/sites/95/2017/04/LecturesOnJurisprudence.pdf
Smith, A. (1776). An Inquiry into the Nature and Causes of the Wealth of Nations. In The Glasgow Edition of the Works and Correspondence of Adam Smith, Vol. 2: An Inquiry into the Nature and Causes of the Wealth of Nations, Vol. 1 . Oxford University Press. https://doi.org/10.1093/oseo/instance.00043218
State Department (US Department of State) (2024). Nuclear Nonproliferation Treaty . Bureau of International Security and Nonproliferation. https://www.state.gov/nuclear-nonproliferation-treaty/
Tellis, A. J. (2023). Completing the US-India Civil Nuclear Agreement: Fulfilling the Promises of a Summer Long Past . Carnegie Endowment for International Peace. https://carnegieendowment.org/research/2023/11/completing-the-us-india-civil-nuclear-agreement-fulfilling-the-promises-of-a-summer-long-past?lang=en
Thaler, R. H., Tversky, A., Kahneman, D., & Schwartz, A. (1997). The Effect of Myopia and Loss Aversion on Risk Taking: An Experimental Test. The Quarterly Journal of Economics, 112, 647-661. https://doi.org/10.1162/003355397555226
UN (United Nations) (1945). United Nations Charter . https://www.un.org/en/about-us/un-charter/full-text
UN (United Nations) (1968). Treaty on the Non-Proliferation of Nuclear Weapons (NPT) . Office for Disarmament Affairs. https://disarmament.unoda.org/wmd/nuclear/npt/text/
US AEC (1974). Annual Report to Congress. Atomic Energy Commission Report to the Joint Committee on Atomic Energy, 93rd Congress, 2nd Session, HR . Government Printing Office. https://www.osti.gov/biblio/4249479
US AEC-DOJ (1968). Competition in the Nuclear Power Supply Industry. Atomic Energy Commission/Department of Justice . Government Printing Office.
US Congress (1986). Low-Level Radioactive Waste Policy Amendments Act of 1985 (Public Law No: 99-240) . https://www.congress.gov/bill/99th-congress/house-bill/1083/text
US DOE-NNSA (Department of Energy, National Nuclear Security Administration) (2024). Sharing the Atom: NPT Talk. US DOE-NNSA and Argonne National Laboratory . https://sharingtheatom.com/
Varian, H. R. (1992). Microeconomic Analysis (3rd ed.). Norton. https://www.academia.edu/74036524/Microeconomic_Analysis_Hal_Varian
Waters, R. H., Hyder, A. A., Rajkoti, Y., Basu, S., & Butchart, A. (2012). The Costs of Interpersonal Violence—An International Review . Social and Economic Costs of Violence: Workshop Summary . National Institute of Health. https://www.ncbi.nlm.nih.gov/books/NBK189992/
WNA (2020). United States Nuclear Power Policy . World Nuclear Association. https://world-nuclear.org/information-library/country-profiles/countries-t-z/usa-nuclear-power-policy
WNN (2024a). Framatome, TerraPower Announce Plans for HALEU Metallization Plant . World Nuclear News. https://www.world-nuclear-news.org/Articles/Framatome,-TerraPower-announce-plans-for-HALEU-met
WNN (2024b). DOE Selects HALEU Enrichment Providers . World Nuclear News. https://www.world-nuclear-news.org/articles/doe-selects-haleu-enrichment-providers
Wood, T., Hilliard, L. & Rothwell, G. (2021). Thoughts on the Distinction between Private and National Interests in Nuclear Technology Commerce . Working Paper.