Are interactions important in estimating flood damage to economic entities? The case of wine-making in France

Abstract. Estimating flood damage, although crucial for assessing risk and designing mitigation policies, continues to face numerous challenges, notably the assessment of indirect damage. It is widely accepted that damage other than direct can account a significant proportion total Yet due scarcer data sources lack knowledge on links within between economic activities, impacts have received less attention impacts. Furthermore, attempts grasp through models not gone below regional levels. Even though local communities be devastated by events without this being reflected in accounts, few studies been conducted from microeconomic perspective at level. What more, standard practices applied level analysis tackle entities but ignore how they may linked. This paper addresses these two challenges building novel agent-based model agricultural production chain (a French cooperative wine-making system), utilized as virtual laboratory ex ante estimation We show overlooking existing interactions chains result either overestimation (double counting) or underestimation (wrong consequences activity) Our results also reveal considering requires thorough characterization their spatial configuration. Based both application our method obtained, we propose balanced recommendations