DMCA
One Kind of Lawlessness: Estimating the Welfare Cost of Somali Piracy (2012)
BibTeX
@MISC{Besley12onekind,
author = {Tim Besley and Thiemo Fetzer and Hannes Mueller},
title = {One Kind of Lawlessness: Estimating the Welfare Cost of Somali Piracy},
year = {2012}
}
Share
 |
 |
 |
 |
||
OpenURL
Abstract
This paper estimates the e¤ect of piracy attacks on shipping costs using a unique data set on shipping contracts in the dry bulk market. We look at shipping routes whose shortest path exposes them to piracy attacks and nd that the increase in attacks in 2008 lead to around a ten percent increase in shipping costs. We use this estimate to get a sense of the welfare loss imposed by piracy. Our intermediate estimate suggests that the creation of $120 million of revenue for pirates in the Somalia area led to a welfare loss of over $1:5 billion. We thank seminar participants at the LSE(EOPP), DIW and IAE. We thank Richard Neylon for useful advice. Ali Saadatnia and Alessandro Torti provided valuable research assistance. We thank the International Growth Centre (IGC) at LSE for nancial assis-tance in collecting the data. Fetzer thanks the Konrad Adenauer Foundation for support. Mueller thanks MOVE. All mistakes are ours. 1 1
Keyphrases
welfare cost somali piracy welfare loss dry bulk market konrad adenauer foundation international growth centre unique data set ali saadatnia intermediate estimate mueller thanks move seminar participant ten percent increase piracy attack shipping cost somalia area valuable research assistance richard neylon nancial assis-tance alessandro torti useful advice
