Should BP Be Held Liable for Economic Losses Due to the Moratorium on Oil Drilling Imposed after the Deepwater Horizon Accident?

Vanderbilt Law Review, Forthcoming

Harvard Law and Economics Discussion Paper No. 708

21 Pages Posted: 5 Oct 2011

See all articles by Steven Shavell

Steven Shavell

Harvard Law School; National Bureau of Economic Research (NBER)

Date Written: October 5, 2011

Abstract

In the aftermath of the Deepwater Horizon accident and the BP oil spill, the government imposed a moratorium on deepwater oil drilling in the Gulf of Mexico. The question addressed here is whether on grounds of policy BP should be held responsible for moratorium-related economic losses caused by the spill. The answer that is developed is no. The reason, in essence, is that although the spill caused the moratorium, the moratorium might be viewed as a socially beneficial event on net because its purpose was to avert a significant danger.

JEL Classification: K13, K32

Suggested Citation

Shavell, Steven, Should BP Be Held Liable for Economic Losses Due to the Moratorium on Oil Drilling Imposed after the Deepwater Horizon Accident? (October 5, 2011). Vanderbilt Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1939188

Steven Shavell (Contact Author)

Harvard Law School ( email )

1575 Massachusetts
Hauser 406
Cambridge, MA 02138
United States
617-495-3668 (Phone)
617-496-2256 (Fax)

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
United States

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