Estimating the Social and Economic Consequences of Natural Hazards: Fiscal Impact Example

Abstract

To make rational decisions about investments in mitigation or disaster preparedness, decision makers need to understand not just the physical impacts of natural disasters, but also their likely social and economic consequences. However, most of the social science research on natural disasters has taken the form of postevent case studies and has not been designed to support the development of quantitative models like those developed in the engineering field. This paper lays out a conceptual framework for the development of quantitative models of social and economic consequences that are driven by the physical damage estimates produced by the combination of geophysical and engineering models. It then provides a particular example of this type of model by estimating one particular type of consequence—fiscal impact. The findings show that property damages from a set of hazard events had a predictable negative impact on property tax and that the negative impacts were more serious in poorer and smaller counties than other counties. This type of information should be particularly salient to local decision makers as they plan for hazard mitigation and response.