publication . Preprint . Conference object . 2013

Assessing Risks and Regulating Safety Standards in the Oil and Gas Industry: The Peruvian Experience

Arturo Vásquez Cordano; Salvador Jácome, J.; García Carpió, R.; Fernández Guzmán, V.;
Open Access
  • Published: 01 Feb 2013
Abstract
Environmental regulation has usually focused on controlling continuous sources of pollution such as CO2 emissions through carbon taxes. However, the 2010 oil spill in the Gulf of Mexico has shown that accidents associated to safety failures can also generate bursts of pollution with serious environmental consequences. Regulating safety conditions to prevent accidents in the oil and gas industry is challenging because public regulators cannot perfectly observe whether firms comply with safety laws. Likewise, it involves a complex political process in which different agents such as the government and oil companies interact and compete. This paper studies this prob...
Subjects
free text keywords: jel:D81, jel:K23, jel:L95, Safety standards, Risk management, business.industry, business, Incentive, Fossil fuel, Environmental economics, Enforcement, Petroleum industry, Government, Environmental quality, Environmental resource management

2. Identifying Safety Risks in Oil and Gas Activities: The Peruvian Case.......................................10 3.1. Setting the Socially Optimal Level of Safety Effort: A Theoretical Perspective .....................13 3.2. Informational Asymmetries regarding Safety Effort: The Principal-Agent Problem..............14 4. Safety Regulation in Practice: Monitoring the Oil and Gas Industry in Peru ............................20 Appendix N° 1: System of Self-Reporting through Affidavits.........................................................31 2010. According to investigations made by several authors (e.g., Cavnar 2010, Vásquez 2012)

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