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Residual Risk Accounting: A Pilot Study of the Coastal Sector

Author

Listed:
  • Scott Farrow

    (UMBC)

Abstract

Risks continue near the coasts such as flooding, oil spills, deaths and unemployment despite numerous policies to prevent and mitigate their effects. Such policies are typically analyzed in their natural units, such as jobs, and so comparisons are difficult across risk categories. An approach similar to supplemental national income and product accounting allows direct comparison of the relative importance and variability of these residual risks. Results for the coastal sector highlight the stability and large expected annual costs associated with some activities such as recreational boating fatalities. In contrast, other categories such as oil spills and flooding exhibit high variability and in the case of flooding, a high level of damages. The results are useful in the strategic development of regulations, causal models and policy design.

Suggested Citation

  • Scott Farrow, 2014. "Residual Risk Accounting: A Pilot Study of the Coastal Sector," UMBC Economics Department Working Papers 14-01, UMBC Department of Economics.
  • Handle: RePEc:umb:econwp:1401
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    File URL: http://www.umbc.edu/economics/wpapers/wp_14_01.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Risk accounting; shadow price; flood; VSL; unemployment;
    All these keywords.

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • D60 - Microeconomics - - Welfare Economics - - - General
    • Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General

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