708. Steven Shavell, Should BP Be Liable for Economic Losses Due to the Moratorium on Oil Drilling Imposed after the Deepwater Horizon Accident, 10/2011; forthcoming in a symposium on the BP Oil Spill in the Vanderbilt Law Review, November 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.