Abstract
The present study addresses the impact of the Deepwater Horizon event on the U.S. frozen fish and shellfish markets. Given a demand system approach, trends in consumption were carefully measured and tested while controlling for own price, cross price, and conditional expenditure effects as well as autocorrelation. Consumption trends beginning the first week of the data set were unaltered by the event. Moreover, the effect of the event was not statistically significant in either demand system. The aggregate national data for the grocery store distribution channel, which includes mostly imported seafood and some domestic aquaculture-sourced seafood, likely contributes to these findings of lack of avoidance behavior.
Highlights
On April 20, 2010 the Deepwater Horizon exploded later sank causing a disruption to economies dependent on the Gulf of Mexico
The aggregate, national data set for the grocery store distribution channel, which includes mostly imported seafood and some domestic aquaculture-sourced seafood, likely contributes to this finding
The present study addresses the economic impacts of this environmental event on the U.S frozen fish and shellfish markets
Summary
On April 20, 2010 the Deepwater Horizon exploded later sank causing a disruption to economies dependent on the Gulf of Mexico. Vickner [1] notes that it was the largest oil spill on record, in the Gulf of Mexico and globally, having leaked nearly five million barrels It was orders of magnitude larger than the iconic 1989 Exxon Valdez oil spill in Alaska’s Prince William Sound. The Deepwater Horizon event was widely covered in the news for several months, initially with coverage of the burning oil rig, loss of life, and injured workers, and later coverage of the extensive cleanup efforts which included images of oil-covered birds and beaches. This environmental disaster resulted in the largest corporate settlement in U.S history of nearly $21 billion.
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