A framework for economic loss estimation due to seismic transportation network disruption: a spatial computable general equilibrium approach

Hirokazu Tatano () and Satoshi Tsuchiya

Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, 2008, vol. 44, issue 2, 253-265

Abstract: This paper presents a framework for assessing the economic impact of disruption in transportation that can relate the physical damage to transportation networks to economic losses. A spatial computable general equilibrium (SCGE) model is formulated and then integrated with a transportation model that can estimate the traffic volumes of freight and passengers. Economic equilibrium under a disruption in the transportation network is computed subject to the condition that the adjustment of labor and capital inputs is restricted; the model reflects slow adjustment of these linked to the state of recovery. As a case study, the model reviews the large Niigata-Chuetsu earthquake of 2004. Considering the damage to the transportation infrastructure, the model indicates the extent of the economic losses arising from the earthquake distributed over regions as a consequence of the intra- and interregional trade in a regional economy. The results show that 20% of the indirect losses occur in the Niigata region directly affected by the earthquake, whereas 40% of the total losses are experienced in the Kanto region and non-negligible losses reach rather remote zones of the country such as Okinawa. Copyright Springer Science+Business Media B.V. 2008

Keywords: Natural disaster; Economic impact assessment; Indirect loss estimation; Spatial computable general equilibrium (SCGE) model (search for similar items in EconPapers)
Date: 2008
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DOI: 10.1007/s11069-007-9151-0

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