Abstract for:Assessment of the Impact of an Earthquake on Business Performance
The paper puts forward a system dynamics model that can be used in order to assess the impact of an earthquake on the performance of a business. Earthquakes can negatively affect the functionality of community infrastructure systems by damaging their components. The failure of infrastructure systems can negatively influence the businesses that are dependent upon their functionality. In addition, earthquake can cause changes in the disposable income of the citizens, demand for the goods and services produced by businesses, activity levels of businesses, available employment opportunities, costs of doing business, profitability of businesses, and the tax income of the government. The system dynamics simulation model proposed in this research characterizes the dynamics of post-earthquake performance of a business based on its relationship with lifelines (e.g., utility and road networks) and infrastructures that it relies on for its performance as well as the state of the market in which it operates. The model can provide the decision makers with an insight into how to reduce the vulnerability of a business in the face of probable future earthquakes.