Risk and Resilience Management in Social-Economic Systems

10 Pages Posted: 13 May 2016

See all articles by Tatyana Kovalenko

Tatyana Kovalenko

ETH Zurich

Didier Sornette

Risks-X, Southern University of Science and Technology (SUSTech); Swiss Finance Institute; ETH Zürich - Department of Management, Technology, and Economics (D-MTEC); Tokyo Institute of Technology

Date Written: May 4, 2016

Abstract

We provide a roadmap to understand and develop resilience, based on the realisation that resilience is the complement of risk, both being associated to the stresses supported by the socio-economic system. We propose instruments for resilience build-up and management based on a novel classification of risk and resilience management regimes corresponding to the system’s degree of uncertainty/predictability and stress level within it. Four main quadrants are identified: Ad hoc management, Adaptive management, the Black swan regime and the Dragon-king regime. An annotated bibliography is also provided.

Keywords: Resilience, risk, stress, uncertainty, predictability, dynamics, exogenous, endogenous, adaptive management, black swan, dragon-king

JEL Classification: D81, G32

Suggested Citation

Kovalenko, Tatyana and Sornette, Didier, Risk and Resilience Management in Social-Economic Systems (May 4, 2016). Swiss Finance Institute Research Paper No. 16-30, Available at SSRN: https://ssrn.com/abstract=2775264 or http://dx.doi.org/10.2139/ssrn.2775264

Tatyana Kovalenko

ETH Zurich ( email )

Rämistrasse 101
ZUE F7
Zürich, 8092
Switzerland

Didier Sornette (Contact Author)

Risks-X, Southern University of Science and Technology (SUSTech) ( email )

1088 Xueyuan Avenue
Shenzhen, Guangdong 518055
China

Swiss Finance Institute ( email )

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland

ETH Zürich - Department of Management, Technology, and Economics (D-MTEC) ( email )

Scheuchzerstrasse 7
Zurich, ZURICH CH-8092
Switzerland
41446328917 (Phone)
41446321914 (Fax)

HOME PAGE: http://www.er.ethz.ch/

Tokyo Institute of Technology ( email )

2-12-1 O-okayama, Meguro-ku
Tokyo 152-8550, 52-8552
Japan

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