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The Challenge of Estimating the Impact of Disasters: Many Approaches, Many Limitations and a Compromise

  • Andre F. T. AvelinoEmail author
  • Geoffrey J. D. Hewings
Chapter
Part of the Advances in Spatial Science book series (ADVSPATIAL)

Abstract

The recent upward trend in the direct costs of natural disasters is a reflection of both an increase in asset densities and the concentration of economic activities in hazard-prone areas. Although losses in physical infrastructure and lifelines are usually spatially concentrated in a few areas, their effects tend to spread geographically and temporally due to the more spatially disperse nature of production chains and the timing and length of disruptions. Since the 1980s, several techniques have been proposed to model higher-order economic impacts of disruptive events, most of which are based on the input-output framework. However, their contributions are fragmented in different models, and, still missing, is a more comprehensive accounting of production scheduling, seasonality in industrial linkages and demographics dynamics post-event. In this chapter, the Generalized Dynamic Input-Output (GDIO) framework is presented and its theoretical basis derived. It integrates previous contributions in terms of intertemporal dynamics, explicit intratemporal modeling of production and market clearing, inventory depletion/formation and expectation’s adjustment. Moreover, we add to the literature by introducing induced effects via a demo-economic extension to study the impact of displacement and unemployment post-disaster, the impact of disruption timing via seasonal input-output tables, and production chronology via the sequential interindustry model.

Keywords

Natural disasters Production chain disruptions Input-output Higher-order effects 

Notes

Acknowledgments

The authors would like to thank Yasuhide Okuyama, Adam Rose and the two anonymous reviewers for providing substantial feedback and suggestions to improve this work. Any remaining errors are our own.

Funding

This research was supported in part by an appointment to the U.S. Army Corps of Engineers (USACE) Research Participation Program administered by the Oak Ridge Institute for Science and Education (ORISE) through an interagency agreement between the U.S. Department of Energy (DOE) and the U.S. Army Corps of Engineers (USACE). ORISE is managed by ORAU under DOE contract number DE-SC0014664. All opinions expressed in this chapter are the author’s and do not necessarily reflect the policies and views of USACE, DOE or ORAU/ORISE.

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Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  • Andre F. T. Avelino
    • 1
    Email author
  • Geoffrey J. D. Hewings
    • 2
  1. 1.Regional Economics Applications Laboratory, Department of Agricultural and Consumer EconomicsUniversity of IllinoisUrbanaUSA
  2. 2.Regional Economics Applications LaboratoryUniversity of IllinoisUrbanaUSA

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