Olaf Jonkeren

ANALYSING CRITICAL INFRASTRUCTURE FAILURE WITH A RESILIENCE INOPERABILITY INPUT–OUTPUT MODEL

Over the past few years much effort has been made in modelling economic losses resulting from critical infrastructure failure. It has appeared that including resilience measures in the modelling approach, which may mute the losses considerably, is a challenging task. At the same time it is necessary because it prevents the modeller from generating overestimates. This study presents two directions to improve the modelling of (economic) resilience for which the state-of-the art with respect to dynamic inoperability input–output modelling is taken as a starting point. Firstly, the new model allows for a different recovery path than the traditionally assumed ‘concave up decreasing curve’ describes for a disrupted infrastructure or economic sector in the aftermath of a disaster. In this paper, we explain how the recovery path may depend on the type of disaster. Secondly, the model refines the aspect of ‘inventory’ as a resilience measure. Inventory is interpreted in a broad sense here: it can be any resilience measures which enable an infrastructure or economic sector to continue its supply despite being disrupted. The model is applied to both a simple two-sector illustrative example and a severe winter storm scenario in Europe using economic data from the World Input–Output Database to show its practical usefulness.

Climate change and economic consequences for inland waterway transport in Europe

Future climate conditions are likely to affect inland waterway transport in Europe. According to some climate scenarios, in summer, in the river Rhine, periods with low water levels are likely to occur more often and become more serious. Then inland waterway transport carriers will experience more severe restrictions on the load factor of their inland ships, which implies a stronger reduction in transport capacity in the market. Transport prices will rise under such conditions. Some studies reviewed in this paper find that at extremely low water levels, the price per tonne for inland waterway transport in the river Rhine area will almost double. These increased transport prices result in welfare losses. For the dry summer in 2003, the losses for North West Europe are estimated to sum up to around €480 million. Increased transport prices trigger adaptation. Inland waterway carriers may use smaller vessels, and shippers have the opportunity to shift from inland waterway transport to alternative transport modes in periods with low water levels. This effect is probably rather modest, however, with a modal shift to road and rail smaller than 10xa0%. Also, changes in transport costs may lead to relocation of certain economic activities in the long run.

Inoperability Input-Output Modeling: Inventory Optimization and Resilience Estimation during Critical Events

AbstractAssessing the ability of critical infrastructures to overcome shocks and optimizing their preparedness for critical events is a key factor in reducing damage, ensuring resilience, and mitigating monetary losses. When considering the problem in a broad sense, the assessment of technical dependencies among engineered systems can be supported by the analysis of economical relationships. A key tool to accomplish this objective is to exploit the input-output approach proposed by Wassily Leontief for the quantitative analysis of the relationships among different branches of an economy. Recently, the input-output approach was effectively exploited to assess the resilience of economies against critical events that may affect some sectors and ripple through neighboring economic segments as a function of their vulnerability, inertia, and centrality to the overall economy. Building on an existing approach, this paper considers a dynamic inoperability input-output model with inventories, examined according to...

Effects of low water levels on the river Rhine on the inland waterway transport sector

This paper examines the welfare effect of water level variation on the river Rhine through its impact on freight prices in the inland waterway transport market. We study this effect using a unique dataset including information about more than 3000 journeys of inland navigation vessels in 2003, of which 700 are useful for our analysis. We demonstrate that the freight price increases by up to 100% at the lowest water levels compared to the situation of normal water levels. The welfare loss for the economy in 2003 as a result of the increase in freight prices due to low water levels amounts to about Є 189 million.

Protection of Critical Waterborne Transport Infrastructures : An Economic Review

Abstract It is essential that transport infrastructures are protected against events which cause their failure. At an optimal level of protection, the sum of protection costs and expected residual damages following from disruptions will be minimized. In most cases however, this optimal level is not achieved because infrastructure protection is susceptible to various market and government failures. This brings us to the question who (a private or public actor) should do how much (the level of protection and intervention). This question is addressed in the present paper. The starting point of the paper is the Directive of the European Council on the identification and designation of European Critical Infrastructures. We review the protection of critical waterborne transport infrastructures from an economic perspective. The review is based on a literature study and several interviews with Critical Infrastructure experts. For the studied infrastructures, we have identified causes and effects of their failure and examined the private–public roles in protecting them. Considering the market and government failures which occur in such configuration of roles, we propose several changes. We conclude that from a national policy perspective there are two important routes: (1) reinforcement of private sector roles among others by defining liabilities and providing information on risks and (2) strengthening of supra-national collaboration via improving and standardizing regulations, cost-sharing initiatives and penalty systems.

Evaluating the Resilience of Critical Infrastructures Assessing Interdependencies and Economic Impact: The Role of Inventories

The input-output approach proposed by Wassily Leontief is regarded as a key tool for the quantitative analysis of the interdependencies between dierent interconnected sectors within an economy, especially in today’s highly interactive networks of producers/service providers. In recent years, Leontief’s model was also extended in order to assess their resilience to critical events, such as a disruption aecting some sectors and propagating through others according to their vulnerability, reaction times and centrality to the overall economy. In this context, a key factor towards the mitigation of monetary losses is represented by preparedness, which is associated to a large extent to the availability of inventories, able to ensure extended continuity of product/service delivery in spite of the temporary partial or complete inoperability of some sectors. Building on an approach based on the dynamic inoperability input-output model with inventory, originally proposed in (Barker and Santos 2010), in this paper we formulate an optimization problem and propose an algorithm to determine how a proper sizing of each sector’s cumulative inventory level can enhance the overall resilience to selected critical events.