The Structural Challenges Presented by Distant Risks

The lowly pine beetle now holds the record for the largest infestation in North American history. The beetles have attacked pine forests across 12 western states, and in British Columbia are now laying siege to an area three times the size of Maryland.
Conditions for this infestation were, in a sense, created long ago. Clear-cutting and wild- fire suppression helped create forests of same-age trees, the pine beetle’s favorite (infestations may also be helped by unusually mild winters).
This project examines “JARing Actions,” an acronym for ‘Jeopardize Assets that are Remote’ in time, distance, or probability. Another factor is that the distributions of the catastrophes that result from these actions often have “hefty tails” — more deaths and more damage than are predicted. In addition to the pine beetle infestation, the group is using this methodological lens to look at earthquakes, floods, and fires.

Publications & Related Links

Alan Berger, Carolyn Kousky, and Richard Zeckhauser (2008). "Obstacles to Clear Thinking about Natural Disasters: Five Lessons for Policy," in Risking House and Home: Disasters, Cities, Public Policy, John M. Quigley and Larry A. Rosenthal (eds.), Berkeley: Berkeley Public Policy Press. (pdf)
Alan Berger, Case Brown, and Carolyn Kousky and Richard Zeckhauser (forthcoming 2010). "The Five Neglects: Risks Gone Amiss," in Mitigating and Recovering from Natural and Unnatural Disasters, H. Kunreuther and M. Useem (eds.), Philadelphia, PA: Wharton School Publishing. (pdf)

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