Marie-Aude Laguna, Gunther Capelle-Blancard, 05 May 2010

As oil continues to spew from the wreck of BP’s Deepwater Horizon rig in the Gulf of Mexico, this column analyses the possible effect on the company’s share price. Similar industrial accidents are associated with a loss in market capitalisation of roughly 12% six months after the accident. But does this provide enough of an incentive for managers to invest in improved safety?

CEPR Policy Research