EAGER: A Novel Investigative Approach for Empirical and Theoretical Advances in Dynamic Economic Resilience

About This Grant

The objective of this EArly-concept Grant for Exploratory Research (EAGER) project is to support research on developing new economic theory and estimation models for studying dynamic economic resilience—how these firms can bounce back rapidly and cost-effectively. The research intends to facilitate optimal investment decision-making for businesses, government, insurance companies, and other key decision makers in the aftermath of disasters. Small and mid-sized enterprises (SMEs) are the lifeblood of our economy. Unfortunately, many SMEs hit by catastrophic disasters go out of business or face a long and costly recovery. In many regions of our country, these SMEs are also hit more than once, and some are still recovering from a prior disaster. This research aims to support the cost-effective decisions regarding the timing and level of investment in repair and reconstruction activities, ensuring that businesses and insurance companies do not spend unnecessarily. When hit by a disaster, businesses scramble to repair damaged facilities, work around disrupted utility services, manage a disrupted workforce, or respond to other key disruptions in their operations. Knowing which investments in repair and reconstruction are going to be most effective and cost-effective, and knowing when to invest, are critical to achieving successful recovery. This project seeks to develop microeconomic production theory and resilience metrics to improve our collective understanding of how decision makers can improve these important decisions. The research then looks to map the theory and metrics to a data collection effort, using advanced survey techniques to collect economic and recovery data from firms hit by recent disasters. The work then seeks to develop statistical approaches for evaluating those data to identify optimal investment in dynamic economic resilience. These activities could help identify best practices and obstacles that limit efficient recovery. They can also potentially inform federal, state and local agencies of more targeted policies. Ultimately, efficient recovery reduces the need for public-sector assistance, reduce insurance liabilities, and improves economic development. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.