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Challenges and Opportunities for Economic Evaluation of Disaster Risk Decisions

Author

Listed:
  • Nicola Smith

    (Market Economics Ltd)

  • Charlotte Brown

    (Resilient Organisations Ltd)

  • Garry McDonald

    (Market Economics Ltd)

  • Morag Ayers

    (Market Economics Ltd)

  • Robert Kipp

    (Resilient Organisations Ltd)

  • Wendy Saunders

    (GNS Science)

Abstract

Decision-makers today are required to assess disaster risk management options in increasingly complex and uncertain environments. Disaster risk management typically involves significant investment to mitigate low probability or highly uncertain events. We argue that under these circumstances existing economic evaluation toolkits do not adequately support decision-making. Our paper outlines the key economic evaluation tools used in decision-making and, in turn, advances a research agenda for future development and application of these approaches. Priority challenges to be addressed include resilience thinking, multi-capital assessment, valuing the future, accounting for distributional equity, social appetite for risk, and deep uncertainty. We also recommend a strong focus on capacity and capability building to improve the risk literacy of decision-makers.

Suggested Citation

  • Nicola Smith & Charlotte Brown & Garry McDonald & Morag Ayers & Robert Kipp & Wendy Saunders, 2017. "Challenges and Opportunities for Economic Evaluation of Disaster Risk Decisions," Economics of Disasters and Climate Change, Springer, vol. 1(1), pages 111-120, June.
  • Handle: RePEc:spr:ediscc:v:1:y:2017:i:1:d:10.1007_s41885-017-0007-0
    DOI: 10.1007/s41885-017-0007-0
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    Cited by:

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    2. Ilan Noy & Shunsuke Managi & Stephane Hallegatte, 2018. "Economics of Disasters and Climate Change – The Journal’s First Year," Economics of Disasters and Climate Change, Springer, vol. 2(1), pages 1-3, April.
    3. Mingming Xiang & Wei Zhao & Jiao Chen, 2018. "A Comparison of Different Reconstruction Modes and Adaptive Evaluation Systems for Community Recovery Following the Wenchuan Earthquake," Sustainability, MDPI, vol. 10(11), pages 1-22, November.
    4. Veeshan Rayamajhee & Alok K. Bohara & Virgil Henry Storr, 2020. "Ex-Post Coping Responses and Post-Disaster Resilience: a Case from the 2015 Nepal Earthquake," Economics of Disasters and Climate Change, Springer, vol. 4(3), pages 575-599, October.
    5. Kythreotis, Andrew P. & Hannaford, Matthew & Howarth, Candice & Bosworth, Gary, 2024. "Translating climate risk assessments into more effective adaptation decision-making: the importance of social and political aspects of place-based climate risk," LSE Research Online Documents on Economics 122155, London School of Economics and Political Science, LSE Library.
    6. McDermott, T.K.J. & Surminski, S., 2018. "Normative interpretations of climate risk assessment and how it affects local decision making – a study at the city scale in Cork, Ireland," Working Papers 309607, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    7. Väinö Nurmi & Karoliina Pilli-Sihvola & Hilppa Gregow & Adriaan Perrels, 2019. "Overadaptation to Climate Change? The Case of the 2013 Finnish Electricity Market Act," Economics of Disasters and Climate Change, Springer, vol. 3(2), pages 161-190, July.

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