RAND Report Says Natural Disaster Research Could Help Reduce Economic Losses

For Release

July 15, 2003

Nationwide economic losses from natural disasters could be reduced if federally funded research focused on better ways to protect people, buildings and infrastructure, according to a RAND report issued today.

Most disaster research funding has contributed to improved weather forecasting and other short-term warning techniques, with less emphasis on the problem of large property losses from floods, hurricanes and other natural hazards, according to the study by RAND's Science and Technology Policy Institute.

Natural disaster losses in the United States amounted to $7 billion in the 11-year period of 1978 to 1989, and jumped to $39 billion in the 3-year period of 1999 to 2002. Disaster losses cost the U.S. economy an average of several hundred million dollars a week.

“Our study gives policymakers the information they need to refocus research and to provide better methods to reduce the destruction caused by natural disasters,” said Charles Meade, the RAND report's lead author.

The report recommends several immediate actions to help identify effective research and development strategies. Important elements include: establishing a comprehensive loss database; using loss modeling to identify important research needs; reorienting research and development towards long-term loss mitigation efforts rather than short-term prediction goals; and increasing efforts that help reduce losses caused from destruction of homes, buildings, and other costly large-scale infrastructure.

The RAND report quantifies levels and allocations of federal research and development funding for natural disasters, comparing spending associated with particular disasters with the actual losses incurred. This creates a greater understanding of the extent and distribution of disasters losses, enabling government decision makers to better prioritize funding, Meade said.

Until now, it has not been possible to answer basic questions regarding the level and distribution of funding or the role that research and development plays in confronting the pressing problem of natural disaster losses.

Drawing from the most recent information available, the report says the total level of research and development funding is small in comparison with the losses incurred from national disasters.

Each year, the federal government spends about six times more on short-term natural disaster prediction programs than on long-term disaster protection efforts, according the RAND report.

Construction of vulnerable structures in high-risk areas such as coastlines, tornado zones and river valleys is a primary cause for mounting disaster losses, researchers say. Population growth results in a corresponding increase in the complexity and density of a community's infrastructure, such as public utilities, roads, transportation systems and communication networks.

Business groups, citizens, and government officials have called for a focused effort to finding a solution to the problem. Research and development efforts have led to the invention of Doppler radar systems that predict severe weather, advanced satellite systems for tracking hurricanes, and new sensor networks for monitoring earthquake activity. Because of past successes such as these, the American public has grown to expect more from federally funded research and development.

While research and development is only part of a larger hazard loss endeavor, it provides the necessary knowledge base from which the most effective preparation, prevention, response, operations, and recovery measures are formulated.

In response to a request from the federal Office of Science and Technology Policy, RAND carried out a comprehensive analysis of the federal research and development funding that supports reductions in economic losses from disasters.

Researchers drew from the Office of Management and Budget, federal agency budget requests, and reports from the Office of the Federal Coordinator of Meteorology to determine the total cost and distribution of hazard loss reduction research and development initiatives.

RAND's Science and Technology Policy Institute is a federally funded research and development center sponsored by the National Science Foundation. The institute undertook the study as part of its mission to conduct objective, independent research and analysis on public policy issues involving science and technology.

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