Oil Spillage and Damage Costs: U.S. Inland Waterway Tank Barge Accidents

This study investigates determinants of the oil spillage, vessel damage, and other-property damage costs of U.S. inland waterway tank barge accidents and their relationships. The tobit estimation of a three-equation recursive model suggests that type of accident, cause of accident, operating conditions, vessel characteristics, and regulation are determinants. Collision accidents incur the largest oil spillage and vessel damage costs, whereas fire/explosion accidents incur the largest other-property damage costs. A dollar of vessel damage cost increases other-property damage cost by $0.51, whereas a dollar of oil spillage increases this cost by $9.13. An important result for formulating tank barge accident cost-reduction policies is that a given determinant might cause an increase in one damage cost but reduce another.