| This thesis, written under the guidance of Professor Adam Rose, is an explicit recognition of the increasing importance of natural hazards to human societies. It combines two important research fields: energy and environmental economics, and employs computable general equilibrium (CGE) modeling, a cutting edge technique of economic analysis.; Losses from hazard are a result of joint human and natural interaction. As societies expand, so do their investments in capital and their economic linkages. Hence, the analysis of natural hazards is of increasing importance in the face of rising susceptibility of the human society to extreme natural phenomena.; In the case of an earthquake hazard, the economic losses extend beyond the actual ground-shaking event both in time and in scale. It takes time to rehabilitate urban lifelines. During this time, their customers, even if they suffer no direct physical damage, may not be able to operate. The most powerful earthquake event, recorded in the US, occurred near present day Memphis, TN in 1812, which is the study site for this thesis.; A CGE model has been chosen since it simultaneously captures the multi-market, optimizing behaviors of producers and consumers, through the flexible specification of technology and preferences. Hence, it comes closest to portraying the adjustments that would take place in a real economy in the wake of an earthquake. This thesis models the economic impact of electricity lifeline losses, based on alternate scenarios and an estimate of capital stock damage received from a separate study.; Two separate sets of policy simulations are presented. The first assumes a region-wide outage of electricity following an earthquake and simulates the economic impact. The second set of simulations estimate the economic losses based on a pattern of outages that are regionally-differentiated. |
