National Economic Impact Analysis of Terrorist Attacks and Natural Disasters

National Economic Impact Analysis of Terrorist Attacks and Natural Disasters

Edited by Harry W. Richardson, Jiyoung Park, James E. Moore II and Qisheng Pan

This book develops a national economic impact model to estimate the effects of simulated terrorist attacks and natural disasters on individual US States and economic sectors. The model, called NIEMO (The National Interstate Economic Model) looks at interindustry relationships and interregional trade. It is highly disaggregated making the model very accurate. The authors examine potential attack targets including theme parks, sporting events, bridges and tunnels in the national highway system as well as attempts to shoot down airplanes or spread foot-and-mouth disease. Covered natural disasters are almost all real world: Hurricane Katrina, the Joplin Tornado, the Gulf Oil Spill and Hurricane Sandy. The effects on State economies caused by the closing international borders in response to a global pandemic is also examined.

Chapter 12: Hurricane Sandy

JiYoung Park, Harry W. Richardson, ChangKeun Park and Minsu Son

Subjects: economics and finance, methodology of economics, environment, disasters, politics and public policy, political economy, terrorism and security


Measuring economic impacts stemming from various natural disasters is an increasingly common interest in the United States. Even since the US economy experienced severe losses from the two hurricanes that consecutively hit the Gulf of Mexico coast in August 2005, we are still experiencing similar damage every year. The recent Hurricane Sandy is one of the greatest storms ever to hit the United States and clearly illustrates this problem, especially if a hurricane hits a mega metropolitan area located on the coast. New York City (NYC) and Long Island have the most coast-concentrated population and economy in the United States. NYC and Long Island’s geographical location exposes the region to a high level of vulnerability from the threat of storm surges. The recent physical disruptions and environmental damages caused by Hurricane Sandy demonstrate the fragility of NYC and Long Island in terms of built and natural environmental systems.

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