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Society For Risk Analysis Annual Meeting 2009

Risk Analysis: The Evolution of a Science

Session Schedule & Abstracts

* Disclaimer: All presentations represent the views of the authors, and not the organizations that support their research. Please apply the standard disclaimer that any opinions, findings, and conclusions or recommendations in abstracts, posters, and presentations at the meeting are those of the authors and do not necessarily reflect the views of any other organization or agency. Meeting attendees and authors should be aware that this disclaimer is intended to apply to all abstracts contained in this document. Authors who wish to emphasize this disclaimer should do so in their presentation or poster. In an effort to make the abstracts as concise as possible and easy for meeting participants to read, the abstracts have been formatted such that they exclude references to papers, affiliations, and/or funding sources. Authors who wish to provide attendees with this information should do so in their presentation or poster.

Common abbreviations

Applications of Risk- and Benefit-Cost Analysis Sponsored by EBASG

Room: Pride of Baltimore   1:30-3:00 PM

Chair(s): Bob Scharff

T3-I.1  13:30  A model for integrating quantitative risk analysis of vendor’s environmental performance into supplier selection process. Yaraghi N*, Hajbagheri M; Royal Institute of Technology (KTH)

Abstract: Buying organizations are increasingly considering environmental performance criteria for supplier selection. Although a number of models and tools have been developed to integrate environmental performance into supplier selection process, they still fail to capture the risks and uncertainties linked to environmental performance. To bridge this gap, this study introduces a new decision support model, based on Monte Carlo simulation technique, for quantitative analysis of the risks associated with supplier’s environmental performance. An example is also presented to illustrate application of the proposed model. This study provides a more reliable basis for evaluating suppliers and is expected to be of interest to the buying organizations which pursue strategic relationships with vendors.


Abstract: Many valuation studies have estimated willingness to pay for improved air quality. These studies always warn, however, that the subjective values elicited do not separate health effects from visibility. To partly address this issue, we implemented a stated choice survey in Santiago de Chile to break down the benefits of improved air quality into those two components. Since health effects comprise many endpoints, we considered respiratory illnesses that result in an emergency room visit with a probability of hospitalization being required for appropriate treatment. This health endpoint is considered for three different age strata. Visibility is described as an aesthetic effect related to the number of days per year of high visibility. The payment vehicle is an increase in the bill of a public utility service. The stated choice game comprised 12 choice situations. A status quo option is always available for those individuals who want to stick to the current situation. Modeling comprises both logit and mixed-logit models, with and without covariates. The monetary value of avoiding one respiratory illness that results in an emergency room visit ranges from US$3,400 to US$12,000 for adults; the same value for children and for the elderly ranges from US$8,200 to US$18,500 and from US$12,500 to US$20,000 respectively. In all three cases, the mixed-logit models yield the lower values and the logit models, the higher values; thus accounting for unexplained variability has an impact on estimated values. The value of an extra day of high visibility per year ranges from US$300,000 to US$900,000, and once again the mixed-logit models yield the lower figures. From a conceptual point of view, this research shows the complex nature of valuing certain health endpoints such as respiratory illness, whose consequences could be far-reaching as a chain of events exists in which each subsequent event has a higher level of illness intensity, but with a decreasing probability of occurrence; in the worst case, death could occur.

T3-I.3  14:10  Cost and Benefits of the new decontamination plan for Santiago de Chile. Gomez J*, De La Maza C, Toha E, Cifuentes L; Pontificia Universidad Católica de Chile

Abstract: On 1998, the Prevention and Decontamination Plan for the Metropolitan Area (PPDA) was officially implemented as a way to achieve the primary standards of air quality in Santiago de Chile. The measures considered in the PPDA have helped to reduce, gradually and systematically the high levels of pollution in the city. However, the annual rate of reduction of concentrations of PM2.5 has downslope over time. Several new measures are proposed in the 2009 plan to revert this situation. The present study evaluates economically and socially the new proposed measures. The measures cosnidered include the control of emissions from mobile sources (17), industrial sources (6), wood heating (2) and off-road sources, illegal fires and re-suspended dust. Additionally, this study evaluates the social benefit from the incorporation of green areas as a measure to control pollution. With regard to improvements in air quality, the highest contribution comes from the measures aimed to control wood heating and illegal fires (5.6 ug/m3 of PM2.5 2015), followed by the contribution of measures that control industrial sources (3.0 ug/m3 to 2015). The PPDA would achieve by 2015 a reduction of 10.6 ug/m3 of PM25, which represents a reduction of 31% compared to the baseline. Regarding health effects, the PPDA will avoid between 8300 and 17,000 deaths from chronic exposure and between 19,000 to 83,000 emergency room visits (period: 2009-2015). The PPDA net profit ranges between MUS$2,100 and MUS$12,000 (period: 2009-2015, discount rate: 8%). The private sector takes the majority of the costs of the plan, 64% (abatement equipments in industrial sector). Most of the benefits (85%) are perceived by the general population.

T3-I.4  14:30  Prevention through Surveillance: The Efficacy of the PulseNet Laboratory System as a Means of Preventing Foodborne Illness. Scharff RL*; Ohio State University

Abstract: The PulseNet surveillance system was designed to identify and mitigate the harm from outbreaks associated with foodborne illness. Despite tangible successes of PulseNet activities, the results from improved outbreak surveillance have been misinterpreted by both commentators and policymakers. Most notably, an increase in observed food-related outbreaks has been seen as evidence of a crumbling food safety system. The truth is not so clear. While identified outbreaks have increased, identified illnesses (as measured by the FoodNet active surveillance system) have fallen. This suggests that the increase in outbreaks reported may be an artifact of improved outbreak surveillance, not declining safety. In this study, I examine the economic efficacy of the PulseNet system. Benefits from this system are generated both as a result of earlier detection of outbreaks and, perhaps more importantly, through a deterrence effect operating on companies that seek to avoid litigation and negative publicity (reputation costs) that would accrue to companies associated with an outbreak. Thus, the surveillance system creates important, but often overlooked, market-based incentives to improve supply-chain risk management and traceability. The costs of this system are limited; especially when compared to the cost of a proposal to inspect (with questionable results) all domestic food facilities subject to FDA regulation (at a cost of $525 million).

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