1 The Cardiff Business School's report on this oil spill resulted
in a £21m loss to the tourist industry in Wales. The fishing industry lost a further £5m as a result of restrictions upon fishing because of the spillage.
The article suggests that salvagers are more interested in rescuing a multi-million pound tanker than in avoiding the loss of a few hundred thousand pounds worth of oil. How can this view be supported in the
light of the damage caused by the oil spill?
2 Produce a simple Cost Benefit Analysis, identifying the private costs,
private benefits, social cost and social benefits of the oil industry in
Milford Haven.
3 In America, the principle of 'the polluter pays' has become widely accepted. What effect does this policy have upon the profitability of firms and their willingness to take risks? Explain how this policy may affect insurance companies and the premiums they charge.
