Simulation of the Economic Impact of Region-Wide Electricity Outages from A Natural Hazard Using a CGE Model 101 SIMULATION OF THE ECONOMIC IMPACT OF REGION-WIDE ELECTRICITY OUTAGES FROM A NATURAL HAZARD USING A CGE MODEL

Analysis of economic losses from natural hazards assumes greater importance as societies expand, while extreme natural phenomena become more variable. The economic impact, of electricity outages resulting from an earthquake, has been simulated using a CGE model. The economic region is Memphis, Tennessee, which suffered the most powerful earthquake ever recorded in the US. Several sets of policy simulations are presented for a region-wide outage of electricity following an earthquake. These are further evaluated for different labor market assumptions and electricity price scenarios. Finally, a conditional systematic sensitivity analysis is carried out to test for parametric sensitivity of the results.