Assessing the Economic Impact of the Deepwater Horizon Oil Spill on Selected Industries

Fishing boat off Grand Isle, Louisiana, photo by thepipe26/Flickr

Photo by thepipe26/Flickr Fishing boat off Grand Isle, Louisiana

The Economics subteam is assessing the economic impacts of the Deepwater Horizon oil spill on Gulf Coastal communities, particularly effects on fishing, seafood processing, and tourism industries.

Using publicly available, routinely collected data on landings, revenues, and fishing effort for select fish species, researchers are examining overall impact of the DWH oil spill as well as changes that occurred over time.

Selected Findings:
What Were the Direct Impacts of the 2010 Deepwater Horizon (DWH) Oil Spill on the Commercial Blue Crab Fishery?

  • We compared changes in Gulf landings following the spill to changes in Atlantic landings, and found that the spill resulted in a 75-85% decrease in landings in the months immediately following the spill, followed by a relatively swift recovery. While there is some evidence of potential longer-term impacts, we cannot estimate these effects precisely. Because of the potential for substitution between Gulf and Atlantic crab, these results represent an upper bound on the true impact.
  • We also compared landings in Louisiana crabbing basins that were more versus less affected by the spill, and found a 50% drop in crabbing trips in basins that were more affected following the spill, but little impact on landings, likely because the spill and the resulting closures changed the relationship between effort (trips) and landings.
  • Overall, our findings suggest that the Deepwater spill did result in substantial, short-term losses to the blue crab fishery, but that the fishery also exhibited a high degree of resilience and recovered quickly as soon as the closures were ended.

View Summary of Findings »
View Full Report »

 

Commercial blue crab landings and crabbing trips in the Gulf and Atlantic states

Annual commercial blue crab landings in the Gulf states and the Atlantic states Authors’ calculations based on monthly landings data downloaded from the NOAA Commercial Landings database. The vertical line in each figure indicates the Deepwater Horizon spill in April 2010.

Louisiana commercial blue crab landings and crabbing trips

Annual commercial blue crab landings and crabbing trips in Louisiana basins Annual commercial blue crab landings and crabbing trips in Louisiana basins defined as treatment and control, as discussed in the text. Authors’ calculations based on data provided by the Louisiana Department of Wildlife and Fisheries. The vertical line in each figure indicates the Deepwater Horizon spill in April 2010.

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Lead

Craig Bond, Ph.D.

Economist

RAND Corporation

Craig Bond

Craig Bond is an applied economist who specializes in natural resource and environmental economics, including stochastic dynamic modeling, resource valuation, consumer choice, and applied welfare economics. His research interests span the environmental, natural resource, and agricultural economics fields. Bond is also a professor at the Pardee RAND Graduate School.

Co-Lead

Shanthi Nataraj, Ph.D.

Economist

RAND Corporation

Shanthi Nataraj

Shanthi Nataraj is an economist at the RAND Corporation and a professor at the Pardee RAND Graduate School. Her research interests include economic development, labor markets, and environmental and resource economics.

Graduate Student

Jacqueline Fiore

Graduate Student and Research Assistant

Tulane University

Jacqueline_Fiore_photo

Jacqueline Fiore is a Ph.D. student in the Economic Analysis and Policy program with the Department of Economics at Tulane University. She specializes in applied microeconomics and her research interests include health economics, economics of disaster, development economics, and public policy. Recently, she has been working on the economic and health impact of the 2010 Deepwater Horizon oil spill. Specifically, she is interested in the impact the oil spill had on firms and human mental health outcomes in Gulf Coast communities.