Jump to ContentJump to Main Navigation
Show Summary Details
In This Section

Journal of Benefit-Cost Analysis

Online
ISSN
2152-2812
See all formats and pricing
In This Section

News and Social Cost: The Case of Oil Spills and Distant Viewers

Scott Farrow
  • UMBC
/ Douglas M. Larson
  • University of California, Davis
Published Online: 2012-12-17 | DOI: https://doi.org/10.1515/2152-2812.1074

Abstract

Although contingent valuation methods are now frequently used to assess the total value of even distant events, benefit-cost analysis could also be informed by observed behavior that links distant events and consumers. It is typically the news media which connect passive consumers to distant events about which they may or may not take action. The information and adaptation costs incurred by the news consumer are privately beneficial, but additionally are shown to be a lower bound to social welfare losses from a socially defined “bad” event under plausible circumstances. The recent Deepwater Horizon well blow-out in the U.S. Gulf of Mexico is a current example which we seek to inform by study of the oil spill from the Valdez, Alaska spill in 1989. We identify an incremental willingness to pay for news about the Exxon Valdez spill above a standard news broadcast and an increased probability of viewing a broadcast related to the spill. We develop and explain how this private value associated with media consumption can be interpreted as a partial measure of social costs for passive viewers who take no further action beyond news viewing and likely represent the majority of affected citizens (though not necessarily the majority of social costs). Though the per-person values of passive users may be modest in magnitude in the present application, some passive use values appear to be measurable, and that it may well be worth pursuing further the search for the faint but observable links between behavior and distant events through the news media.

Keywords: information; adaptation; passive use; media; oil spill; television

About the article

Published Online: 2012-12-17



Citation Information: Journal of Benefit-Cost Analysis, ISSN (Online) 2152-2812, DOI: https://doi.org/10.1515/2152-2812.1074. Export Citation

Comments (0)

Please log in or register to comment.
Log in