@article {bnh-4400, title = {Integrating intangible values in economic analyses of flood mitigation: a case study of the Brown Hill and Keswick creeks catchment in Adelaide}, journal = {Australian Journal of Emergency Management}, volume = {32}, year = {2017}, month = {09/2017}, abstract = {

This study undertakes an economic analysis of flood mitigation options for a high flood-risk catchment in Adelaide. To date, economic analyses have focused primarily on estimating the tangible (market) costs and benefits of mitigation strategies and have largely ignored the intangible (non-market) costs and benefits. This analysis improves upon previous studies by conducting a benefit-cost analysis that incorporates the intangible costs and benefits of mitigation. The benefit transfer method was used to include intangible values in the analysis. It was found that, for this particular case study, the inclusion of intangible values does not change the attractiveness of the mitigation options evaluated and the benefit-cost ratios remain below one.

}, url = {https://ajem.infoservices.com.au/items/AJEM-32-04-17}, author = {Veronique Florec and Morteza Chalak and Atakelty Hailu} } @article {bnh-4234, title = {Integrating non-market values in economic analyses of flood mitigation: a case study of the Brown Hill and Keswick creeks catchment in Adelaide}, number = {354}, year = {2017}, month = {11/2017}, institution = {Bushfire and Natural Hazards CRC}, address = {Melbourne}, abstract = {

This study undertakes an economic analysis of flood mitigation options for a high flood risk catchment in Adelaide, South Australia: the Brown Hill and Keswick creeks catchment. Several proposals for flood mitigation investments have been presented, including creek capacity upgrades, high flow bypass culverts and detention dams. For flood managers to know which option or options provide the best value for money, it is necessary to compare the costs and the benefits of all available options. To date, economic analyses have focused primarily on estimating the tangible (market) costs and benefits of mitigation strategies, but have largely ignored the intangible (non-market) costs and benefits. This analysis improves upon previous studies by conducting a cost benefit analysis that incorporates the intangible costs and benefits of mitigation. We used the benefit transfer method to include eight different intangible values that can be affected by floods or by the implementation of the proposed mitigation options. We found that for this particular case study in the Brown Hill and Keswick creeks catchment, the inclusion of intangible values does not change the results of the analysis significantly; the results with and without intangibles are relatively similar. This is because intangible values are relatively small compared to the potential tangible flood damages as intangible value losses represent only between 6 and 21\% of total damages. In order to better understand people{\textquoteright}s preferences and the trade-offs they make, a survey based nonmarket valuation research would need to be conducted amongst the residents at risk of flooding. Such a study would provide values that are specific to the catchment and could be compared with the intangible values from the literature that have been assembled for this study.

}, issn = {354}, author = {Morteza Chalak and Veronique Florec and Atakelty Hailu and Fiona L Gibson and David J Pannell} } @article {bnh-2923, title = {Economics of natural hazards: Annual project report 2015-2016}, number = {177}, year = {2016}, month = {08/2016}, institution = {Bushfire and Natural Hazards CRC}, address = {Melbourne}, abstract = {

The project tackles from an economics perspective issues relating to non-financial benefit estimation, risk analysis, and development of decision-making frameworks that would help deliver value for money from public investments in natural hazard management. It has a broad scope in terms of natural hazards, including fires, earthquakes, floods, cyclones and tsunamis. It aims to improve the management of bushfires and other natural hazards by delivering the following outcomes:

The research team has extensive experience in non-market valuation, integrated modelling and the economics of environmental and natural resource management and policy. The team has also recruited four outstanding environmental economists with extensive experience in.\ The project has continued to engage well with the end user community and other potential collaborators. Project staff have been keen to help identify research priorities and deliver research outcomes that are based on a broader analysis of the costs and benefits of mitigation options and inform management and policy choices accordingly. The project{\textquoteright}s major accomplishements for the year include the following:

}, issn = {177}, author = {David J Pannell and Atakelty Hailu and Fiona L Gibson and Veronique Florec and Morteza Chalak and Abbie Rogers} } @conference {bnh-2947, title = {Integrated economic assessment of flood management options for Adelaide}, booktitle = {AFAC16}, year = {2016}, month = {08/2016}, publisher = {Bushfire and Natural Hazards CRC}, organization = {Bushfire and Natural Hazards CRC}, address = {Brisbane}, abstract = {

cent of the overall cost of Australian natural disasters is the consequence of flooding and this, on average, costs approximately $600 million per annum (Gentle et Bureau of Transport Economics, 2001; Productivity Commission 2015). These average figures do not reflect the severity of the impact that some floods can cause. For example, the magnitude and extent of the recent (2011) Queensland floods was vast, with an overall cost estimates above $6.8 billion.


There is a growing recognition that Australia{\textquoteright}s disaster funding arrangements are not efficient and do not create the right incentives for managing risks (Productivity Commission 2015). There is underinvestment in disaster mitigation and overinvestment in post-disaster interventions. Across Australia, flood maps have become a major mitigation strategy. Other mitigation strategies include structural solutions such as levees, dams, diversion channels, floodgates, and detention basins as well as non-structural solutions such as early warning and evacuation systems and community education programs. The structural solutions are typically capital intensive and costly. On the other hand, the assessment of flood mitigation benefits generally tends to be partial and focused on tangible and direct benefits. As a result, investment decisions can be suboptimal.\ For optimal and equitable investment in mitigation, it is important to understand the full range of costs and benefits and also how these costs and benefits are distributed among different segments of the community. Therefore, it is important that cost and benefit assessment methods depict an adequate picture of the costs and benefits of possible risk mitigation measures. Otherwise, even simple option evaluation procedures such as cost-benefit analysis are not precise. A panel of experts convened under the European Union{\textquoteright}s {\textquoteleft}Costs of Natural Hazards{\textquoteright} (CONHAZ) project identified key areas for improvement in cost/benefit assessment and these include the need for more focus on non-structural measures, and indirect and intangible costs (Meyer et al. 2013). Intangible values, normally excluded from benefit cost analysis, can be significant or even the most dominant set of values in some cases.


The purpose of this presentation is to address the shortcoming in relation to intangible values in the context of flood mitigation option analysis for the Brown Hill and Keswick catchments in Adelaide. The catchments include both rural and urban areas and involve local government councils for Adelaide, Burnside, Mitcham, Unley and West Torrens. This analysis focuses on a set of flood mitigation options that are currently under consideration following a public consultation. Previous analysis done on these options suggests that the benefit-cost ratios appear unfavourable. However, the analysis was done without the inclusion of intangible values. In this presentation we argue why intangible values should be included and provide estimates that show how our understanding of the costs and benefits of mitigation options would change with the inclusion of intangible values to account for the health, environmental and social impacts of floods. Intangible values relevant in the context of natural hazards in general are shown in Table 1.

}, author = {Morteza Chalak and Veronique Florec and Atakelty Hailu and Fiona L Gibson and David J Pannell} }