Risk analysis: The unbearable cleverness of bluffing

Abstract

ABSTRACT A critical contemplation is offered of what is known and what is not known about the hydrological, economic, and societal uncertainties that are eagerly and routinely subjected to all kinds of mathematical prestidigitation in the process of risk analysis of water resources systems. An illustration of the issues is provided by a reality check on some real-life situations, mostly based on the author's own experience from the past forty years. Three simple recommendations are offered that may bring risk analysis down to earth. INTRODUCTION Spurred by the newly available computing technology, the influx of mathematical statistics and probability theory into the analysis of uncertainty in hydrology and water resources in the 1960s was powerful and unprecedented. Also unprecedented has been its side effect – an outburst of “applications” of various spurious theories suddenly made so easy by the computer. By the mid-1970s the danger of this malignant growth was already evident and solitary warning voices could be heard. One of the clearest and most passionate was that of the late Myron Fiering of Harvard University: “Fascination with automatic computation has encouraged a new set of mathematical formalisms simply because they now can be computed; we have not often enough asked ourselves whether they ought to be computed or whether they make any difference … we build models to serve models to serve models to serve models, and with all the computation, accumulated truncation, roundoff, sloppy thinking, and sources of intellectual slippage, there is some question as to how reliable are the final results” (Fiering 1976).