The Economic Effects of Floods : Investigations of a Stochastic Model of Rational Investment Behavior in the Face of Floods

1. Introduction -- Outline of the Study -- 2. Background and Assumptions -- The Landowner or Investor -- The Description of Available Activities -- The Choice of Replacement Date -- The Effect of Floods -- The Probability of Floods -- 3. The Choice of the Optimal Activity -- 4. The Optimal Replacement Policy -- 5. When Flood Probabilities are Unknown: The Bayesian Approach -- Incomplete Information about µ -- The Description of Beliefs and of Learning -- The Simple Case: Investment Contracts can only be Made After Floods -- An Intermediate Case -- The Case where Replacement is Possible at any Time -- 6. Flood Control and Relief Measures: An Elementary View -- The Definition of Flood Damage -- Dams, Levees, and Other Flood Protection Works -- Flood Insurance -- Flood Relief -- Flood Plain Zoning -- 7. Computer Simulation of Investment Behavior in a Flood Plain -- Appendix FORTRAN Computer Program.