Indirect Economic Loss Estimation due to Seismic Highway Transportation System Disruption in “5.12” Wenchuan Earthquake

Abstract

This paper aims to model the indirect economic loss due to damaged highway transportation systems in earthquake-affected areas that tends to be overlooked by decision-makers compared to direct economic loss that can be measured by repair or replacement cost. A regional Computable General Equilibrium (CGE) model is applied for estimating indirect economic loss in the whole economic system of the affected area. Shifang is a county-level city located in northwest Chengdu city, which is the capital of Sichuan Province, China. In the “5.12” Wenchuan earthquake, Shifang was one of the ten hardest-hit counties or cities and its highway transportation system was seriously damaged. It was selected as a case study to evaluate the indirect economic loss by seismic highway transportation system disruption. Results show that indirect economic loss accounted for nearly 36.4% of direct economic loss, which is as significant as direct economic loss resulting from earthquakedamaged highway transportation systems, and thus should be paid enough attention by decision-makers in pre-earthquake prevention and postearthquake recovery and reconstruction.