Lloyd's Science of Risk Prize winner
We are thrilled to announce that Charlotte Brown and the MERIT team have placed second in the Pandemics prize category in Lloyd's 2021 Science of Risk competition for their work on 'Accounting for business adaptations in economic disruption models'.
The capacity for businesses to adapt in the face of adversity has been clearly demonstrated through the COVID-19 pandemic. Actual economic losses and business closures related to COVID-19 have been significantly lower than projected, which demonstrates the inadequacy of our economic models to account for important contributing factors such as business behaviours.
This research is the first of its kind to build an empirically-derived model of business impact and recovery following disruption. Using business impact and recovery data from the 2010-2011 Canterbury earthquakes (New Zealand), and qualitative validation, this paper presents a novel, transferable model for estimating business recovery following disruption.
It challenges the status quo in economic modelling of disruption events. It is a paradigm shift from static business as usual models, to techniques that capture and account for the evolution of an economy under stress. We live in an increasingly volatile world with challenges such as climate change, technology advancements and globalisation that are changing the way we do business. Every crisis and disruption shifts the dial further. Consequently, our economic models must be able to adapt too. The MERIT model does this through the translation of a CGE model to a system dynamics framework that seeks equilibrium but is not set to an equilibrium. The BBM is a vital input to MERIT. Without understanding the behaviour of businesses under stress, we will not be able to truly understand an economy under stress.
Modelling the Wellington fault line
With the release of the Wellington Lifelines Group report, Protecting Wellington's Economy
Through Accelerated Infrastructure Investment Programme Business Case, Richard Mowll from the Wellington Lifelines Group was interviewed about the project and its findings.
Read more about this project
Modelling a Wellington Fault earthquake
A paper has been published in the Australian Journal of Disaster and Trauma Studies (AJDTS) outlining how strong stakeholder engagement and integrated modelling enabled the development of a comprehensive and robust narrative to support the MERIT modelling of the economic impact of a Wellington Fault earthquake event in New Zealand.
Evaluating the economic consequences of fuel outage scenarios
This study focused on using Non-Spatial MERIT to evaluate the economic consequences of fuel outage scenarios, with and without mitigation options to better understand the impact of disruption and potential value of mitigation actions for New Zealand. The project findings contributed to the Board of Inquiry into the 2017 Auckland Fuel Supply Disruption. The full project report is available from the MBIE website.