Citation

Morshedi MA, Kashani H. Int. J. Disaster Risk Reduct. 2020; 44: e101438.

Copyright

(Copyright © 2020, Elsevier Publishing)

DOI

10.1016/j.ijdrr.2019.101438

PMID

unavailable

Abstract

Interventions such as seismic retrofits and reconstruction of vulnerable buildings can minimize the social and economic consequences of future earthquakes. Various policies can reduce the vulnerability of communities in the face of future earthquakes by enhancing the public risk perception and reducing the costs of interventions for the landlords. There is a need for appropriate tools that can characterize the dynamics of the housing market in response to these policies. The simulation model presented in this manuscript addresses this need. In this model, the decision of the tenants and landlords is characterized by utilizing prospect theory. The impact of candidate policy interventions on the housing market dynamics, the vulnerability reduction measures implementation rates, and the resultant reduction in the vulnerability of the building stock can be evaluated using the proposed model. The capabilities of the proposed model in simulating the policy-induced shifts in the demand between the housing units with different levels of seismic vulnerability, the response of the landlords to these shifts in the demand, and the consequent price movements are shown in the illustrative example. The results indicate that subsidizing the costs of interventions or solely enhancing public awareness may not lead to desired outcomes. It also provides valuable insights into the impact of individuals' risk- and loss-aversion on their response to the evaluated policies. Practitioners can use the proposed model to design new policies that effectively enhance the resilience of communities.

Language: en

Keywords

Housing market; Policy evaluation; Prospect theory; Resilience; Seismic retrofit; System dynamics