The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.
Cost-benefit analysis is a standard tool for determining the efficiency of planned projects. However, one of the major difficulties in risk mitigation investments is that benefits are by nature uncertain. In this context, the standard approach relying on the average value of benefits may provide an incomplete picture of the efficiency of the risk mitigation project under consideration. This paper presents a probabilistic cost-benefit analysis relying on a catastrophe risk model. It produces risk metrics such as the exceedance probability curve of the benefit-cost ratio, thus providing the decisionmaker with a more complete risk analysis of the net benefits of the project. This is illustrated with the earthquake vulnerability reduction project in Colombia.
Poor countries are disproportionately affected by the cost of disasters. Yet there is evidence of the benefits of seeking to mitigate the impact of a disaster, compared with the costs incurred in 'making good' after a major event has occurred. This article reviews a programme of landslide risk reduction in unplanned communities in the Eastern Caribbean. The construction of appropriate surface water management measures, based on the application of scientific and engineering principles, has been demonstrated to reduce the hazard from rainfall-triggered landslides. Adopting a community-based approach additionally delivers social and environmental benefits relating to employment generation, improvements in the environmental conditions within the community, and improvements slope management practices. The sustained implementation of the community-based projects has provided the necessary evidence-base for these practices to influence Government policy and practice, and gain recognition from regional development agencies. The strategic and incremental uptake of the community-based methodology is demonstrated to be an effective means for delivering physical landslide risk reduction measures in the most 'at risk' areas of unplanned housing.
The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.
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