Erwann Michel-Kerjan

At War with the Weather

In 2005, three major hurricanes—Katrina, Rita, and Wilma—made landfall along the U.S. Gulf Coast within an eight-week period. The damage caused by these storms led to insurance reimbursements and federal disaster relief of more than $180 billion—a record sum. Today we are more vulnerable to catastrophic losses because of the increasing concentration of population and activities in high-risk coastal regions of the country. In At War with the Weather, Howard Kunreuther and Erwann Michel-Kerjan and their colleagues deliver a groundbreaking analysis of how we currently mitigate, insure against, and finance recovery from natural disasters in the United States. The two-year study analyzes data on over 10 million homeowners' policies and the operations of private and state-run insurance companies in the hurricane-prone states of Florida, New York, South Carolina and Texas, interpreted in the context of existing state insurance regulatory systems and the structure of the property insurance market in the United States.

"The authors have provided the ultimate institutional and theoretical analysis, and empirical reference source, for hurricane and flood risk insurance and mitigation. At War with the Weather will surely become a sine qua non of every researcher, corporate analyst, and state or federal policymaker, and will be extensively cited. A spectacular work." — Mark J. Machina, Department of Economics, University of California, San Diego " At War with the Weather offers more than just a detailed plan for managing weather risks. It outlines a long-overdue comprehensive, disciplined theory of risk management that applies to all manner of catastrophes." — Michael Chertoff, former U.S. Secretary of Homeland Security "In At War with the Weather , Professors Howard Kunreuther and Erwann Michel-Kerjan and their colleagues present leading thinking in a data-driven analysis of the problem society faces in managing the risk of natural disasters. They analyze the dynamics of the market, including the significance of insurer regulation, and propose innovative solutions. This book is essential reading for anyone searching for solutions to the problem of financing large-scale catastrophes." — Terri M. Vaughan, CEO, National Association of Insurance Commissioners

The Irrational Economist: Making Decisions in a Dangerous World

The Irrational Economist tackles head-on the issues affecting us when we need to make decisions both in our day-to-day lives and in the face of catastrophic threats such as natural disasters, climate change, technological accidents, financial crises, and human malevolence, which have occurred at an accelerating pace recently. Distilling the best knowledge from decision sciences, behavioral economics, neuroscience, psychology, management, insurance, and finance, some of the world's leading pioneers in these fields, including several Nobel laureates, introduce the latest discoveries and thinking that might help us to get our decisions right.

"Dealing with extra-ordinary situations that cannot be quantified on the basis of past experience is one of the key problems facing investors, business executives and government officials. Michel-Kerjan and Slovic brilliantly rally insights from an outstanding group of authors: There is something here for any reader." -- MARTIN FELDSTEIN, professor of economics, Harvard University; former chairman of the White House Council of Economic Advisers under President Reagan "The Irrational Economist challenges conventional wisdoms, overturns traditional economic models, and brings to light new discoveries in decision sciences: The result is a profound revolution in thinking. This book will help us cope better with the myriad of important decisions under uncertainty that we face." -- JOSEPH STIGLITZ, Nobel Prize-winning economist, 2001; former chairman of the White House Council of Economic Advisers under President Clinton

Seeds of Disaster, Roots of Response: How Private Action Can Reduce Public Vulnerability

This is the first published volume to analyze the business strategy/public policy relationship and the trade-off between private decision making and global security outcomes in that context. Foreword by General R. Marsh (Ret. USAF), former Chairman of the President's Commission on Protection of Critical Infrastructure.

"Industries that provide critical infrastructure are becoming more efficient, but more vulnerable. This book introduces security externalities, a phenomenon that inhibits private investments that would make critical infrastructure services more resilient to potential disaster from any source. It calls not only for more leadership but for more realistic policies from both the private and the public sector." -- THOMAS C. SCHELLING, 2005 Nobel Prize Laureate in Economics "With 85% of America's critical infrastructure in private hands, the American people – and America's economy – are not going to be safe without strong, collaborative action by the public and private sector. Seeds of Disaster, Roots of Response is thus a timely and important volume that is a must-read for anyone concerned about our nation's security." -- LEE HAMILTON, Vice Chair, 9/11 Commission "This visionary book reveals the vulnerability of our systems which provide the framework for humanity to exist. The response to this millennium challenge can only be found in our capacity to demonstrate innovative collaboration, effective leadership, and courage. I strongly urge top decision makers to read this book; it provides the necessary guidance to go from words to action." -- KLAUS SCHWAB, Founder and Chairman, World Economic Forum "America must work hard to improve its responses to natural disasters and terror attacks. This book demonstrates that effective coordination with the operators of privately-owned critical infrastructure is a vital part of that work, and offers guidance for progress." -- U.S. Senator SUSAN M. COLLINS, Former Chairman, Committee on Homeland Security and Governmental Affairs, U.S. Senate

Treatise on New Risks. Precaution, Crisis, Insurance