Economically efficient flood protection levels

Abstract

In the Netherlands, economic cost-benefit analysis plays an important role when deciding on safety levels for flood defenses. The cost of increasing the safety level is weighed against the reduction in flood risk (the benefit). The optimal level occurs where the sum of the cost and benefits is at its minimum; this is shown graphically in Figure 2. However, when conditions change over time, due to for example economic growth, the optimal safety levels change as well. This is illustrated in Figure 3. An in-depth description of the current use of cost-benefit analyses in the Netherlands can be found in Kind (2014).