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Of course, to justify their poor preparation to combat such a large leak of oil, Hayward may have greatly understated its probability. As Posner emphasizes, it is very difficult to estimate with any precision what is the actual probability of highly infrequent events, and such a leak would fall within this class. So if the annual probability were really more like 1/10,000 rather than 1/1,000,000, the expected discounted cost would be about $200 million, a more considerable sum. These examples show that only when the annual probability of such a disaster was reasonably large would it have paid for BP to spend a lot to prevent such a leak from happening.

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Thanks for the tips, Scott. Beyond spelling and grammar I spend most of my arts/lit blog time checking info and tracking down links -- and hope that even then I don't mangle them.


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It all comes down to economics, I suppose, and how business in different countries try to fight their relative cultural baggage, in order to boost productivity, increase political stability, reduce wages, and increase efficiency.


Thanks, Gary. It just occurred to me the euphoria could have been delusional. My estimation as to how high the bullets actually were might have been pure hallucination.

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Oil spills and oil leaks imposes a great danger to all of us. We must do our part so we can avoid disastrous things such as this one.

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