Flood risk management: which economic tools to help decision-making?

Abstract

This text examines the following question: "Flood Risk Management: Which Economic Tools to Help Decision-Making?" This question considers only the French case. In the first part we present and analyze the notion of "decisional context" as applied in flood risk preventive management. We distinguish and provide an analytic decomposition of two generic types of such a decisional context, namely: centralized decision-making for general interest; decentralized decision-making for common good. This distinction is compatible with several analyses developed on risky activities (conclusions of the European Program Trustnet, reflections of the Society for Risk Analysis...). In the second part, we underline that economics may improve collective decisions. Two typical approaches to help decision-making are quickly presented, namely Cost-Benefit Analysis and Multi-Criteria Decision Analysis. Their adaptation to flood preventive management is discussed. We suggest that improvements derived from these methods depend above all on their accurate adequacy to the "decisional context" at hand.