By a News Reporter-Staff News Editor at Insurance Weekly News -- Research findings on Risk Management are discussed in a new report. According to news reporting out of Paris, France , by VerticalNews editors, the research stated, "Estimates of the cost of potential disasters, including indirect economic consequences, are an important input in the design of risk management strategies. The adaptive regional input-output (ARIO) inventory model is a tool to assess indirect disaster losses and to analyze their drivers." Our news journalists obtained a quote from the research, "It is based on an input-output structure, but it also (i) explicitly represents production bottlenecks and input scarcity and (ii) introduces inventories as an additional flexibility in the production system. This modeling strategy distinguishes between (i) essential supplies that cannot be stocked (e.g., electricity, water) and whose scarcity can paralyze all economic activity; (ii) essential supplies that can be stocked at least temporarily (e.g., steel, chemicals), whose scarcity creates problems only over the medium term; and (iii) supplies that are not essential in the production process, whose scarcity is problematic only over the long run and are therefore easy to replace with imports. The model is applied to the landfall of Hurricane Katrina in Louisiana and identifies two periods in the disaster aftermath: (1) the first year, during which production bottlenecks are responsible for large output losses; (2) the rest of the reconstruction period, during which bottlenecks are inexistent and output losses lower." According to the news editors, the research concluded: "This analysis also suggests important research questions and policy options to mitigate disaster-related output losses." For more information on this research see: Modeling the Role of Inventories and Heterogeneity in the Assessment of the Economic Costs of Natural Disasters. Risk Analysis , 2014;34(1):152-167. Risk Analysis can be contacted at: Wiley-Blackwell, 111 River St , Hoboken 07030-5774, NJ, USA. (Wiley-Blackwell - www.wiley.com/ ; Risk Analysis - onlinelibrary.wiley.com/journal/10.1111/ (ISSN)1539-6924) Our news journalists report that additional information may be obtained by contacting S. Hallegatte, Center Int Rech Environm & Dev, Paris, France . Keywords for this news article include: Paris, France , Europe , Risk Management Our reports deliver fact-based news of research and discoveries from around the world. Copyright 2014, NewsRx LLC
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