A cost-effective optimization model of safety investment allocation for risk reduction of domino effects

Xiaoxue Guo, Long Ding, Jie Ji and Valerio Cozzani

Reliability Engineering and System Safety, 2022, vol. 225, issue C

Abstract: In general, the allocation strategy of safety measures in the domino effect is based on technical standards or simplistic rules of thumb, often leading to a subjective and uncertain decision-making process. In this work, a cost-effective risk reduction optimization model is proposed to objectively allocate the safety investment concerning domino effects in view of the risk and economic cost. Different from previous safety barrier performance assessments, we directly relate risk to economic cost through mathematical functions to trade off the economic effectiveness and domino effect risk under lower uncertainty. Not only mitigating measures, but also preventive measures are considered for domino risk reduction in the decision-making process of safety investment allocation in practical applications. The results from the case study demonstrate that the proposed model can help decision makers to identify the optimal safety investment among different investments and find the optimal investment allocation strategy given a specific economic investment in the worst-case domino scenario.

Keywords: Domino effect; Risk management; Safety investment allocation; Safety decision-making; Optimal allocation (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reensy:v:225:y:2022:i:c:s0951832022002307

DOI: 10.1016/j.ress.2022.108584

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