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The more accurately a cost index captures a shipbuilder's risk, the less the Navy should have to pay its shipbuilders. The Navy uses such indexes to correct for significant cost risks outside its shipbuilders' control. A longtime material-cost index in Navy shipbuilding is the steel-vessel index, but it is outdated and volatile. The authors urge the Navy to develop a modern-vessel index that more appropriately represents the materials used today.

Shipbuilding -- Costs. --- Shipbuilding -- Materials. --- Ships, Iron and steel. --- Shipbuilding --- Ships, Iron and steel --- Naval Architecture --- Military & Naval Science --- Law, Politics & Government --- Military planning --- War on Terrorism, 2001-2009 --- Armies --- Costs --- Materials --- Costs. --- Materials. --- Iron and steel ships --- Iron ships --- Steel and iron ships --- Steel ships --- Iron, Structural --- Naval architecture --- Armored vessels --- Shipbuilding subsidies