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Optimal Strategies for Flood Prevention

Author

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  • Carel Eijgenraam

    (CPB Netherlands Bureau for Economic Policy Analysis, 2585 JR The Hague, The Netherlands)

  • Ruud Brekelmans

    (Department of Econometrics and Operations Research, CentER, Tilburg University, 5000 LE Tilburg, The Netherlands)

  • Dick den Hertog

    (Department of Econometrics and Operations Research, CentER, Tilburg University, 5000 LE Tilburg, The Netherlands)

  • Kees Roos

    (Delft University of Technology, 2600 GA Delft, The Netherlands)

Abstract

Flood prevention policy is of major importance to the Netherlands since a large part of the country is below sea level and high water levels in rivers may also cause floods. In this paper we propose a dike height optimization model to determine economically efficient flood protection standards. We improve the model proposed by David van Dantzig [van Dantzig D (1956) Economic decision problems for flood prevention. Econometrica 24(3):276–287] after a devastating flood in the Netherlands in 1953. Our model is nonconvex, but we derive an explicit simple expression for the global optimal solution, which is periodic. We also discuss how to use this optimal investment policy to derive an efficient flood protection standard. The rather simple expression for this standard gives us much insight into how it depends on several relevant economic and climate model parameters. This approach has been applied to all dike rings in the Netherlands, and the resulting standards have been stated in the new Delta Programme 2015, which has been accepted by the government.

Suggested Citation

  • Carel Eijgenraam & Ruud Brekelmans & Dick den Hertog & Kees Roos, 2017. "Optimal Strategies for Flood Prevention," Management Science, INFORMS, vol. 63(5), pages 1644-1656, May.
    • Handle: RePEc:inm:ormnsc:v:63:y:2017:i:5:p:1644-1656
    DOI: 10.1287/mnsc.2015.2395
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    References listed on IDEAS

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    1. Stern,Nicholas, 2007. "The Economics of Climate Change," Cambridge Books, Cambridge University Press, number 9780521700801.
    2. Rob Aalbers, 2009. "Discounting investments in mitigation and adaptation: a dynamic stochastic general equilibrium approach of climate change," CPB Discussion Paper 126, CPB Netherlands Bureau for Economic Policy Analysis.
    3. Ruud Brekelmans & Dick den Hertog & Kees Roos & Carel Eijgenraam, 2012. "Safe Dike Heights at Minimal Costs: The Nonhomogeneous Case," Operations Research, INFORMS, vol. 60(6), pages 1342-1355, December.
    4. Carel Eijgenraam & Jarl Kind & Carlijn Bak & Ruud Brekelmans & Dick den Hertog & Matthijs Duits & Kees Roos & Pieter Vermeer & Wim Kuijken, 2014. "Economically Efficient Standards to Protect the Netherlands Against Flooding," Interfaces, INFORMS, vol. 44(1), pages 7-21, February.
    5. Carel Eijgenraam, 2006. "Optimal safety standards for dike-ring areas," CPB Discussion Paper 62, CPB Netherlands Bureau for Economic Policy Analysis.
    6. Martin L. Weitzman, 2007. "A Review of the Stern Review on the Economics of Climate Change," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 703-724, September.
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    Cited by:

    1. Lu, Shibao & Sun, Huaping & Sun, Dongying & Guo, Min & Bai, Xiao, 2020. "Assessment on reservoir flood resources utilization of Ankang Reservoir, China," Resources Policy, Elsevier, vol. 68(C).
    2. Alessio Ciullo & Jan H. Kwakkel & Karin M. De Bruijn & Neelke Doorn & Frans Klijn, 2020. "Efficient or Fair? Operationalizing Ethical Principles in Flood Risk Management: A Case Study on the Dutch‐German Rhine," Risk Analysis, John Wiley & Sons, vol. 40(9), pages 1844-1862, September.
    3. Postek, Krzysztof, 2017. "Distributionally and integer adjustable robust optimization," Other publications TiSEM 74785c83-df0c-4570-828b-f, Tilburg University, School of Economics and Management.
    4. Postek, Krzysztof & den Hertog, Dick & Kind, J. & Pustjens, Chris, 2016. "Adjustable Robust Strategies for Flood Protection," Discussion Paper 2016-038, Tilburg University, Center for Economic Research.
    5. Zwaneveld, P. & Verweij, G. & van Hoesel, S., 2018. "Safe dike heights at minimal costs: An integer programming approach," European Journal of Operational Research, Elsevier, vol. 270(1), pages 294-301.
    6. Postek, Krzysztof & den Hertog, Dick & Kind, J. & Pustjens, Chris, 2016. "Adjustable Robust Strategies for Flood Protection," Other publications TiSEM 6e85c2ff-32dd-4c7e-8d95-a, Tilburg University, School of Economics and Management.
    7. Johanna Grames & Dieter Grass & Peter M. Kort & Alexia Prskawetz, 2019. "Optimal investment and location decisions of a firm in a flood risk area using impulse control theory," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 27(4), pages 1051-1077, December.
    8. Klerk, Wouter Jan & Kanning, Wim & Kok, Matthijs & Wolfert, Rogier, 2021. "Optimal planning of flood defence system reinforcements using a greedy search algorithm," Reliability Engineering and System Safety, Elsevier, vol. 207(C).

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