IDEAS home Printed from https://ideas.repec.org/a/pal/gpprii/v35y2010i3p391-415.html
   My bibliography  Save this article

Governing Ignorance: Emerging Catastrophic Risks—Industry Responses and Policy Frictions

Author

Listed:
  • Giuliano Castellano

    () (Pole de Recherche en Gestion (PREG), Ecole Polytechnique and International University College of Turin, PREG-CRG/ENSTA, 32 Boulevard Victor, PARIS Cedex 15 75739, France.)

Abstract

The growing interconnections between people, markets and networks together with the development of new technologies have increased the frequency and impact of large-scale disasters around the globe. Many of these events, defined as emerging catastrophic (or systemic) risks, have no previous record. At the same time there is a strong probability that their frequency and impact will increase in the future. This paper takes a governance perspective by assuming that policy actions should be designed to cope with ignorance and large-scale losses, being the primary features characterising such emerging catastrophic risks. Precisely, the governance activity should aim both at expanding the industries’ capacity to absorb losses and at acquiring more information about frequency and impact of such losses. However, it appears that some solutions may conflict with policy objectives. In particular, direct governmental interventions to compensate victims and stringent antitrust policy goals might block the development of a market for first-party property insurance for emerging systemic risks. This paper elicits crucial points that require further elaboration by policy-makers, thereby stressing the importance of providing a workable legal definition of such line of risk that embraces the precautionary principle.

Suggested Citation

  • Giuliano Castellano, 2010. "Governing Ignorance: Emerging Catastrophic Risks—Industry Responses and Policy Frictions," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 35(3), pages 391-415, July.
  • Handle: RePEc:pal:gpprii:v:35:y:2010:i:3:p:391-415
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/gpp/journal/v35/n3/pdf/gpp201011a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: http://www.palgrave-journals.com/gpp/journal/v35/n3/full/gpp201011a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Amanda Savitt, 2017. "Insurance as a tool for hazard risk management? An evaluation of the literature," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 86(2), pages 583-599, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:gpprii:v:35:y:2010:i:3:p:391-415. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.palgrave-journals.com/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.