Economic Impacts of the Arkstorm Scenario

4 We estimate the business interruption (BI) impacts of ARkStorm, a severe winter storm scenario 5 developed by the U.S. Geological Survey and partners. BI stems from loss of building function, lost 6 productivity of agricultural land, and reduced lifeline services. We develop a dynamic computable 7 general equilibrium model of the California economy to perform this economic consequence analysis. 8 Economic resilience in the form of input and import substitution is inherent in the model’s equilibrium 9 solution, and we also adjust its parameterization to reflect other forms of resilience such as production 10 recapture and lifeline importance. Varying assumptions about the timing and source of funds for 11 reconstruction results in a range of recovery paths. Five years after the storm, flood-induced building 12 damage is the overwhelming source of GDP losses, timely and partially externally-funded reconstruction 13 mitigates impacts by approximately 50%, and the economy is not guaranteed to return to its baseline 14 GDP trajectory. Our methodology serves as a template for assessing the macroeconomic consequences 15 of disasters and the influence of resilience in reducing BI losses. 16