Developing Optimal Hazard Investment Strategies

There has been a significant increase in natural disasters that have negatively affected the U.S. economy in recent decades. The Government Accountability Office reported that the U.S. is not well prepared to manage large-scale natural disasters either through emergency response or financial relief. It is essential to develop integrated post-disaster investment strategies that avoid many of the pitfalls that have been observed following recent catastrophic events. This paper proposes a conceptual framework to build theoretical foundation and demonstrate technologies for creating a decision support system for optimizing stakeholders' resource allocation in natural hazards. The proposed framework will: (1) minimize the total costs associated with implementing such investment strategies and (2) maximize the uniformity of welfare distribution among all associated parties. This would provide broad members of the emergency management community as well as policy makers with easy-to-use preparedness and decision support tool, which would help in creating better societal financial resilience towards natural hazards.