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J. Grames, A. Fürnkranz-Prskawetz, D. Grass, G. Blöschl:
"Modelling the interaction between flooding events and economic growth";
in: "Extreme Hydrological Events", Copernicus Publications, Göttingen, 2015, piahs-369-3-2015, 1 - 4.

Socio-hydrology describes the interaction between the socio-economy and water. Recent models analyze
the interplay of community risk-coping culture, flooding damage and economic growth (Di Baldassarre
et al., 2013; Viglione et al., 2014). These models descriptively explain the feedbacks between socio-economic
development and natural disasters like floods. Contrary to these descriptive models, our approach develops an
optimization model, where the intertemporal decision of an economic agent interacts with the hydrological system.
In order to build this first economic growth model describing the interaction between the consumption
and investment decisions of an economic agent and the occurrence of flooding events, we transform an existing
descriptive stochastic model into an optimal deterministic model. The intermediate step is to formulate and simulate
a descriptive deterministic model.We develop a periodic water function to approximate the former discrete
stochastic time series of rainfall events.
Due to the non-autonomous exogenous periodic rainfall function the long-term path of consumption and
investment will be periodic.

floods, socio-hydrology, dynamic optimization, economic growth, optimal investment in flood protection measures

http://dx.doi.org/10.5194/piahs-92-1-201

http://publik.tuwien.ac.at/files/PubDat_239170.pdf