Characterizing Economic Disruption with the Global Economic Disruption Index

Abstract

Impacts of disasters are seen through the lens of death, dollars, and downtime, but downtime eludes quantification. This paper presents (1) the Global Economic Disruption Index (GEDI) as a method of describing the economic recovery following disasters, and (2) the GEDI framework, a parallel development that uses hazard intensity, exposure, vulnerability, and resilience to predict GEDI values for specific events. Initial results show substantial agreement with interpreted GEDI values, with an R2 value of 0.82, a root-mean-square error of 0.51, and an accuracy of 0.73. Potential applications are discussed, including advisories, prioritization of mitigation, evaluation of potential supply chain disruption, new insurance products, environmental, social, and governance (ESG) reporting, and diversifying real estate investments in the face of climate change. An illustration provides a sample from the global supply chain interruption stemming from the 2011 Thailand floods.