Economics of a Disaster

BRUCE M. OWEN is President of Economists Incorporated, a Washington, D.C. consulting firm specializing in antitrust and regulatory issues. He also teaches a seminar on law and economics at Stanford University's Washington campus. Owen has been an expert witness in a number of antitrust and regulatory proceedings, including United States vs. AT&T. In 1992, he headed a World Bank task force that advised the government of Argentina in drafting a new antitrust law. He was also chief economist of the Antitrust Division of the U.S. Department of Justice in the Carter administration, and of the White House Office of Telecommunications Policy in the Nixon administration. Owen is the coauthor of Electric Utility Mergers: Principles of Antitrust Analysis1994).DAVID A. ARGUE is a senior economist at Economists Incorporated in Washington, D.C. While at Economists Incorporated, he has researched many issues in environmental economics. Previously, he was an economist at the Center for Public Service in Charlottesville, Virginia and taught undergraduate economics.HAROLD W. FURCHTGOTT-ROTH is a senior economist at Economists Incorporated in Washington, D.C. He was formerly a research fellow at the Brookings Institution and a member of the research staff at the Center for Naval Analyses. His publications include International Trade in Computer Software (Quorum, 1993).GLORIA J. HURDLE, prior to joining Economists Incorporated in Washington, D.C., spent over 13 years as an economist in the Antitrust Division of the U.S. Department of Justice on the Antitrust Subcommittee of the U.S. Senate, and teaching at the Colorado College, the Eastern Michigan University, and the University of Michigan. She has authored or coauthored a number of articles related to industry structure. She has also testified before the U.S. District Court, the Department of Transportation and the Canadian Competition Tribunal. Her work primarily involves transportation, agriculture, and energy.GALE MOSTELLER, during her years at Economists Incorporated in Washington, D.C., has provided economic analysis and litigation support to law firms, corporations, and government agencies concerning antitrust issues, transfer pricing, FIFRA data compensation and economic damages from false advertising, securities fraud, and contract breach.

• Figures and Tables Acknowledgments Introduction The Effect of Disaster on Prices of Goods and Services: An Economic Framework Measuring the Effect of the Exxon Valdez Oil Spill on Alaskan Seafood Prices Industry Background Qualitative Evidence Concerning Price Effects Japanese Consumer Demand Salmon Benchmark Studies Salmon Reduced Form Study Salmon Processor Prices Non-salmon Species Studies Supply Effects Fishing Permit Values Summary of Results Conclusion Appendix 1: A Brief Description of Statistical Terminology Appendix 2: Modeling Japanese Consumer Demand Appendix 3: Reduced Form Model for Alaskan Salmon Appendix 4: Supply Effects Selected Bibliography Index