The Economics of Hydro-Meteorological Disasters: Approaching the Estimation of the Total Costs

BC3 Working Paper Series 2013-12

21 Pages Posted: 29 Aug 2013

See all articles by Stefano Balbi

Stefano Balbi

Ca Foscari University of Venice - Dipartimento di Economia; Basque Centre for Climate Change (BC3)

Carlo Giupponi

Ca Foscari University of Venice - Dipartimento di Economia; Fondazione Eni Enrico Mattei (FEEM)

Roland Olschewski

Swiss Federal Institute for Forest, Snow and Landscape Research WSL

Vahid Mojtahed

Independent

Date Written: August 28, 2013

Abstract

Hydro-meteorological disasters have caused increasing losses in recent years. Efficient risk reduction policies require accurate assessment approaches, with careful consideration of costs, beyond direct tangible costs, which are commonly used in practice. Faced with possible risk reduction scenarios, limited financial resources require an improvement in the quality of cost estimation, thereby contributing to an efficient allocation of resources. This paper focuses on the concept of total costs of hydro-meteorological disasters, based on direct and indirect as well as tangible and intangible cost categories. These categories are defined and explained, supported by a comprehensive review of economic valuation methods. Based on this information, practice relevant suggestions are made concerning the most appropriate methods for different cases in terms of scale, availability of data and of technical resources. Our survey also provides critical insights to drawbacks of flood risk estimation, which need to be addressed and carefully dealt with in any future research in this area.

Keywords: hydro-meteorological disasters, total cost, risk reduction, economic valuation, intangible costs, indirect costs

JEL Classification: Q5

Suggested Citation

Balbi, Stefano and Balbi, Stefano and Giupponi, Carlo and Olschewski, Roland and Mojtahed, Vahid, The Economics of Hydro-Meteorological Disasters: Approaching the Estimation of the Total Costs (August 28, 2013). BC3 Working Paper Series 2013-12, Available at SSRN: https://ssrn.com/abstract=2317437 or http://dx.doi.org/10.2139/ssrn.2317437

Stefano Balbi (Contact Author)

Ca Foscari University of Venice - Dipartimento di Economia ( email )

Cannaregio 873
Venice, 30121
Italy

Basque Centre for Climate Change (BC3) ( email )

Gran Vía 35-2
Bilbao, Vizcaya 48009
Spain

Carlo Giupponi

Ca Foscari University of Venice - Dipartimento di Economia ( email )

Cannaregio 873
Venice, 30121
Italy

Fondazione Eni Enrico Mattei (FEEM) ( email )

Corso Magenta 63
20123 Milan
Italy

Roland Olschewski

Swiss Federal Institute for Forest, Snow and Landscape Research WSL ( email )

Switzerland

Vahid Mojtahed

Independent

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
164
Abstract Views
988
Rank
326,009
PlumX Metrics