Using Disaster Surveys to Model Business Interruption
Abstract
Introduction
Previous Empirical Research
Study using survey data | Analysis method | Dependent variable | Damage variables | Utility variables | or pseudo- | Other included variable categoriesa |
---|---|---|---|---|---|---|
Orhan (2014) | Summary statistics | Closure (Y/N) | Destruction of building (Y/N), needing to clear out damaged contents (Y/N), need to have building structurally assessed (Y/N), loss of machinery (Y/N), loss of inventory or stock (Y/N) | Lifeline losses (Y/N) | N/A | Business characteristics, ownership characteristics, financial capital, customers, labor, transportation |
Tierney and Nigg (1995) and Tierney (1995) | Summary statistics | Closure (Y/N) | Building flooded (Y/N), loss of machinery or equipment (Y/N), loss of inventory (Y/N) | Loss of water (Y/N), loss of electricity (Y/N), loss of natural gas (Y/N), loss of water treatment (Y/N), loss of phone service (Y/N) | N/A | Customers, labor, supply, transportation |
Asgary et al. (2012) | Chi-squared test, correlation | Time to reopen (multiple month intervals) | Level of facility damage (none, minimal, some, significant, total); level of inventory damage (none, minimal, some, significant, total) | Dependence on electricity (Y/N), dependence on water (Y/N), Dependence on transportation (Y/N); lifeline damage (level) | N/A | Business characteristics, ownership characteristics, financial capital, risk perception or disaster experience, recovery perception, labor, social capital |
Flott (1997) | Chi-squared test | Time to reopen (less than 1 month versus more than 1 month) | Level of damage (none, little, major) | N/A | N/A | Business characteristics, financial capital, social capital |
Khan and Sayem (2013) | Logistic regression | Reopened (Y/N); time taken to reopen (1 = more than 1 week) | Machinery or tool loss (Y/N) | Level of electricity supply (hours per day) | Not reported | Business characteristics, ownership characteristics, financial capital, risk perception or disaster experience, recovery perception, customers, labor, supply |
Sultana et al. (2018) | Regression, random forest model | Interruption duration (days) | Water level (centimeters), inundation duration (hours) | N/A | 0.053 | Business characteristics, government response, site characteristics, risk perception or disaster experience, resources, adaptation, customers, supply |
Wasileski et al. (2011) | Logistic regression | Temporary closure (Y/N) | Level of disruptiveness of building damage (0–4); level of contents damage (0–5); structure type (wood frame, unreinforced masonry, stronger structure, or other) | Level of disruptiveness of electricity, phone, water, sewer, transportation (0–4) | 0.118 and 0.087 | Business characteristics, ownership characteristics, resources, customers, labor, transportation |
Yang et al. (2016) | Functional fragility curves and accelerated failure time models | Drop ratio, stagnation time, recovery time | Damage state (DS0–DS3) | N/A | Not reported | Business characteristics |
Research Design
Study Site
Sample and Data Collection
![](/cms/10.1061/NHREFO.NHENG-1807/asset/77da39b4-6b83-46a4-ae45-20b37ac942b0/assets/images/large/figure1.jpg)
Analytical Methods
Findings
Descriptive Statistics
Variable | Observationsa | Meanb | Standard deviationb | Min | Max |
---|---|---|---|---|---|
Dependent variables | |||||
Business interruption (days) | 163 | 17.50 | 38.14 | 0 | 300 |
Business interruption (log days) | 163 | 2.35 | 1.36 | 0 | 5.71 |
Open at 1 week (1 = yes, 0 = no) | 163 | 0.45 | 0.50 | 0 | 1 |
Open at 2 weeks (1 = yes, 0 = no) | 163 | 0.71 | 0.46 | 0 | 1 |
Open at 3 weeks (1 = yes, 0 = no) | 163 | 0.81 | 0.39 | 0 | 1 |
Open at 4 weeks (1 = yes, 0 = no) | 163 | 0.85 | 0.35 | 0 | 1 |
Open at 5 weeks (1 = yes, 0 = no) | 163 | 0.90 | 0.30 | 0 | 1 |
Open at 6 weeks (1 = yes, 0 = no) | 163 | 0.91 | 0.29 | 0 | 1 |
Damage | |||||
Building damage: (1 = yes, 0 = no) | 162 | 0.36 | 0.48 | 0 | 1 |
Content damage: (1 = yes, 0 = no) | 162 | 0.41 | 0.49 | 0 | 1 |
Machinery or equipment damage: (1 = yes, 0 = no) | 161 | 0.15 | 0.35 | 0 | 1 |
Building damage (%) | 162 | 16.62 | 34.59 | 0 | 100 |
Content damage (%) | 162 | 28.25 | 41.09 | 0 | 100 |
Machinery or equipment damage: (%) | 161 | 10.13 | 26.79 | 0 | 100 |
Utility disruptions | |||||
Electricity loss (1 = yes, 0 = no) | 161 | 0.98 | 0.14 | 0 | 1 |
Water loss (1 = yes, 0 = no) | 161 | 0.91 | 0.28 | 0 | 1 |
Natural gas loss (1 = yes, 0 = no) | 149 | 0.08 | 0.27 | 0 | 1 |
Sewer loss (1 = yes, 0 = no) | 153 | 0.36 | 0.48 | 0 | 1 |
Cell phone service loss (1 = yes, 0 = no) | 158 | 0.30 | 0.46 | 0 | 1 |
Electricity loss (log days) | 158 | 1.85 | 0.68 | 0 | 5.20 |
Water loss (log days) | 154 | 2.18 | 0.94 | 0 | 5.20 |
Natural gas loss (log days) | 148 | 0.20 | 0.79 | 0 | 5.90 |
Sewer loss (log days) | 146 | 0.83 | 1.37 | 0 | 6.17 |
Cell phone service loss (log days) | 160 | 0.50 | 0.95 | 0 | 5.48 |
Transportation disruption | |||||
Accessibility problem (i.e., street or sidewalk closure): (1 = yes, 0 = no) | 153 | 0.48 | 0.50 | 0 | 1 |
Customer issues | |||||
Lost customers (1 = yes, 0 = no) | 161 | 0.61 | 22.92 | 0 | 1 |
Employee issues | |||||
Employee home repair problem: (1 = yes, 0 = no) | 154 | 0.51 | 0.50 | 0 | 1 |
Employee childcare or school problems: (1 = yes, 0 = no) | 157 | 0.25 | 0.43 | 0 | 1 |
Employee physical or mental health problems: (1 = yes, 0 = no) | 156 | 0.07 | 0.25 | 0 | 1 |
Business characteristics | |||||
Branch: (1 = yes, 0 = no) | 164 | 0.41 | 0.49 | 0 | 1 |
Manufacturing or construction sector: (1 = yes, 0 = no) | 164 | 0.07 | 0.26 | 0 | 1 |
Retail or wholesale sector: (1 = yes, 0 = no) | 164 | 0.39 | 0.49 | 0 | 1 |
Number of part- and full-time employees before Hurricane Matthew | 163 | 16.20 | 26.91 | 1 | 250 |
Rents premises: (1 = yes, 0 = no) | 161 | 0.56 | 0.50 | 0 | 1 |
Business owner or manager profile | |||||
Race or ethnicity other than non-Hispanic White: (1 = yes, 0 = no) | 159 | 0.39 | 0.49 | 0 | 1 |
Years of experience | 158 | 15.85 | 12.43 | 0.02 | 70 |
Insurance coverage | |||||
Had building insurance: (1 = yes, 0 = no) | 121 | 0.65 | 0.48 | 0 | 1 |
Had contents insurance: (1 = yes, 0 = no) | 125 | 0.58 | 0.50 | 0 | 1 |
Had interruption insurance: (1 = yes, 0 = no) | 113 | 0.34 | 0.47 | 0 | 1 |
![](/cms/10.1061/NHREFO.NHENG-1807/asset/dd371857-82d6-4003-818c-a610cadca763/assets/images/large/figure2.jpg)
![](/cms/10.1061/NHREFO.NHENG-1807/asset/204f3fe3-b056-4f80-8270-1686e52bfd76/assets/images/large/figure3.jpg)
Variable Inclusion Considerations
Variable | Model 1 | Model 2 | Model 3 | Model 4 | Model 5 | Model 6 | Model 7 | Model 8 | Model 9 |
---|---|---|---|---|---|---|---|---|---|
Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | |
Constant | 1.522 | 1.692 | 1.552*** | 1.487*** | 2.243*** | 2.229*** | 1.715*** | 2.141*** | 1.283 |
Damage indicator | |||||||||
Building (1/0) | 0.151*** | — | — | — | — | — | — | — | 0.153 |
Contents (1/0) | 0.705*** | — | — | — | — | — | — | — | 0.507** |
Machinery (1/0) | 1.283*** | — | — | — | — | — | — | — | 0.980*** |
Utility loss indicator | |||||||||
Electricity (1/0) | — | — | — | — | — | — | — | ||
Water (1/0) | — | 0.187 | — | — | — | — | — | — | |
Gas (1/0) | — | 1.781*** | — | — | — | — | — | — | 1.092*** |
Sewer (1/0) | — | 0.158 | — | — | — | — | — | — | |
Cell phone (1/0) | — | — | — | — | — | — | — | ||
Transportation disruption | |||||||||
Access | — | — | 1.134*** | — | — | — | — | — | 0.498** |
Customer issues | |||||||||
Customers | — | — | — | 0.748*** | — | — | — | — | 0.591*** |
Employee issues | |||||||||
Home damage | — | — | — | — | — | — | — | — | |
Childcare or school | — | — | — | — | 0.078 | — | — | — | — |
Health | — | — | — | — | 0.882 | — | — | — | — |
Business characteristics | |||||||||
Branch | — | — | — | — | — | — | — | — | |
Manufacturing or construction | — | — | — | — | — | — | — | — | |
Retail | — | — | — | — | — | — | — | — | |
No. of employees | — | — | — | — | — | 0.001 | — | — | — |
Renter | — | — | — | — | — | — | — | — | |
Owner or manager profile | |||||||||
Race | — | — | — | — | — | — | 0.235 | — | — |
Experience | — | — | — | — | — | — | 0.014 | — | — |
Insurance coverage | |||||||||
Building | — | — | — | — | — | — | — | 0.256 | — |
Contents | — | — | — | — | — | — | — | — | |
Interruption | — | — | — | — | — | — | — | — | |
20.79 | 3.63 | 32.58 | 11.94 | 0.86 | 0.79 | 1.82 | 0.80 | 7.70 | |
-value | 0.000 | 0.004 | 0.000 | 0.001 | 0.464 | 0.557 | 0.165 | 0.498 | 0.000 |
0.345 | 0.146 | 0.192 | 0.083 | 0.033 | 0.028 | 0.025 | 0.019 | 0.460 | |
Sample (before weighting) | 159 | 131 | 153 | 161 | 152 | 150 | 157 | 107 | 118 |
Note: Coefficient = beta coefficient; *; **; and ***.
Variable Measurement Considerations
Variable | Correlation, | Simple linear regression coefficient | |
---|---|---|---|
Building damage () | |||
Percentage (based on damage state) | 0.518*** | 0.022*** | 0.268 |
Indicator (1 = damaged, 0 = not damaged) | 0.339*** | 0.896*** | 0.115 |
Contents damage () | |||
Percentage (based on damage state) | 0.429*** | 0.017*** | 0.280 |
Indicator (1 = damaged, 0 = not damaged) | 0.472*** | 1.205*** | 0.223 |
Machinery damage () | |||
Percentage (based on damage state) | 0.584*** | 0.026*** | 0.300 |
Indicator (1 = damaged, 0 = not damaged) | 0.522*** | 1.850*** | 0.273 |
Electricity loss () | |||
Duration of outage (log days) | 0.513*** | 0.969*** | 0.263 |
Indicator (1 = lost, 0 = not lost) | 0.021 | 0.198 | 0.000 |
Water loss () | |||
Duration of outage (log days) | 0.276*** | 0.375*** | 0.076 |
Indicator (1 = lost, 0 = not lost) | 0.059 | 0.260 | 0.003 |
Gas loss () | |||
Duration of outage (log days) | 0.343*** | 0.586*** | 0.118 |
Indicator (1 = lost, 0 = not lost) | 0.357*** | 1.765*** | 0.127 |
Sewer loss () | |||
Duration of outage (log days) | 0.238** | 0.224*** | 0.056 |
Indicator (1 = lost, 0 = not lost) | 0.096 | 0.264 | 0.009 |
Cell loss () | |||
Duration of outage (log days) | 0.158 | 0.214 | 0.025 |
Indicator (1 = lost, 0 = not lost) | 0.001 | 0.001 | 0.000 |
Maximum disruption (, ) | |||
Maximum damage state (DS1–DS5) | 0.528*** | 0.016*** | 0.261 |
Maximum utility loss (log days) | 0.566*** | 0.566*** | 0.179 |
Note: Coefficient = beta coefficient from simple regression model; *; **; and ***.
Variable | Model 10 (restricted) | Model 11 (unrestricted) | Model 12 (unrestricted) | Model 13 (restricted) | Model 14 (unrestricted) | Model 15 (unrestricted) |
---|---|---|---|---|---|---|
Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | |
Constant | 1.494 | 1.371 | 0.428 | 1.483 | 0.526 | — |
Damage indicator | ||||||
Building (1/0) | 0.194 | 0.165 | 0.128 | — | — | — |
Contents (1/0) | 0.644** | 0.655*** | 0.504** | — | — | — |
Machinery (1/0) | 1.351*** | 1.135*** | 0.825** | — | — | — |
Percentage damage (%) | ||||||
Building | — | — | — | 0.010*** | 0.010*** | 0.009*** |
Contents | — | — | — | 0.008*** | 0.008*** | 0.006** |
Machinery) | — | — | — | 0.012*** | 0.010*** | 0.007** |
Utility loss indicator | ||||||
Electricity (1/0) | — | 0.032 | — | — | 0.139 | — |
Water (1/0) | — | 0.115 | — | — | 0.162 | — |
Gas (1/0) | — | 1.209*** | — | — | 0.970** | — |
Sewer (1/0) | — | — | — | — | ||
Cell (1/0) | — | — | — | — | ||
Log days of utility loss | ||||||
Electricity (log days) | — | — | 0.453** | — | — | 0.435** |
Water (log days) | — | — | 0.113 | — | — | 0.126 |
Gas (log days) | — | — | 0.271** | — | — | 0.189 |
Sewer (log days) | — | — | 0.023 | — | — | |
Cell (log days) | — | — | 0.094 | — | — | 0.087 |
14.19 | 7.99 | 13.10 | 30.00 | 12.71 | 15.85 | |
-value | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 |
0.320 | 0.381 | 0.427 | 0.397 | 0.436 | 0.480 | |
Change in | — | 0.061 | 0.107 | — | 0.039 | 0.083 |
Partial -statistic | — | 1.63 | 3.92 | — | 1.13 | 3.14 |
Partial -statistic -value | — | 0.157 | 0.003 | — | 0.349 | 0.011 |
sample (before weighting) | 127 | 127 | 127 | 127 | 127 | 127 |
Note: coefficient = beta coefficient; *; **; and ***.
Variable | Model 16 (restricted) | Model 17 (unrestricted) | Model 18 (unrestricted) | Model 19 (restricted) | Model 20 (unrestricted) | Model 21 (unrestricted) |
---|---|---|---|---|---|---|
Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | Coefficient | |
Constant | 1.655 | 1.371 | 0.526 | 0.157 | 0.428 | — |
Utility loss indicator | ||||||
Electricity (1/0) | 0.020 | 0.032 | 0.139 | — | — | — |
Water (1/0) | 0.187 | 0.115 | 0.162 | — | — | — |
Gas (1/0) | 1.746*** | 1.209*** | 0.970** | — | — | — |
Sewer (1/0) | 0.090 | — | — | — | ||
Cell (1/0) | — | — | — | |||
Log days of utility loss | ||||||
Electricity (log days) | — | — | — | 0.691*** | 0.453** | 0.435 |
Water (log days) | — | — | — | 0.159 | 0.113 | 0.126 |
Gas (log days) | — | — | — | 0.367*** | 0.271** | 0.189 |
Sewer (log days) | — | — | — | 0.087 | 0.023 | |
Cell (log days) | — | — | — | 0.118 | 0.094 | 0.087 |
Damage indicator | ||||||
Building (1/0) | — | 0.165 | — | — | 0.128 | — |
Contents (1/0) | — | 0.655*** | — | — | 0.504** | — |
Machinery (1/0) | — | 1.135*** | — | — | 0.825** | — |
Percentage damage (%) | ||||||
Building | — | — | 0.010*** | — | — | 0.009*** |
Contents | — | — | 0.008*** | — | — | 0.006** |
Machinery | — | — | 0.010*** | — | — | 0.007** |
3.15 | 7.99 | 12.71 | 12.77 | 13.10 | 15.85 | |
-value | 0.010 | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 |
0.142 | 0.381 | 0.436 | 0.318 | 0.427 | 0.480 | |
Change in | — | 0.239 | 0.294 | — | 0.109 | 0.162 |
Partial -statistic | — | 15.05 | 26.29 | — | 5.20 | 12.56 |
Partial -statistic -value | — | 0.000 | 0.000 | — | 0.002 | 0.000 |
Sample (before weighting) | 127 | 127 | 127 | 127 | 127 | 127 |
Note: Coefficient = beta coefficient; *; **; and ***.
Time Considerations
Variable | Open at 1 week (45% of sampled businesses open) | Open at 2 weeks (71% of sampled businesses open) | Open at 3 weeks (81% of sampled businesses open) | Open at 4 weeks (85% of sampled businesses open) | Open at 5 weeks (90% of sampled businesses open) | Open at 6 weeks (91% of sampled businesses open) |
---|---|---|---|---|---|---|
Building (1/0) | *** | *** | *** | *** | *** | *** |
Contents (1/0) | *** | *** | *** | *** | *** | *** |
Machinery (1/0) | *** | *** | *** | *** | *** | *** |
Building (%) | *** | *** | *** | *** | *** | *** |
Contents (%) | *** | *** | *** | *** | *** | *** |
Machinery (%) | *** | *** | *** | *** | *** | *** |
Electric (initial) | 0.005 | 0.042 | 0.065 | 0.098 | 0.104 | |
Water (initial) | 0.020 | 0.072 | 0.080 | |||
Gas (initial) | ** | *** | ** | ** | *** | *** |
Sewer (initial) | 0.009 | 0.014 | ||||
Cell (initial) | 0.066 | 0.045 | 0.029 | 0.003 | ||
Electric (in period) | *** | *** | *** | ** | ||
Water (in period) | ** | ** | *** | * | ||
Gas (in period) | *** | *** | ** | ** | ** | ** |
Sewer (in period) | ** | ** | ** | ** | * | |
Cell (in period) | ||||||
Customer loss (%) | * | * | * | * | * | |
Access | *** | *** | *** | *** | *** | *** |
Note: *; **; and ***.
Variable | Model 22 |
---|---|
Coefficient | |
Constant | 0.182 |
Percentage damage (%) | |
Building | 0.010*** |
Contents | 0.004 |
Machinery | 0.007** |
Log days of utility loss | |
Electricity (log days) | 0.351* |
Water (log days) | 0.105 |
Gas (log days) | 0.135 |
Sewer (log days) | |
Cell (log days) | 0.145 |
Transportation disruption | |
Access | 0.435** |
Customer issues | |
Customers | 0.483*** |
12.00 | |
-value | 0.000 |
0.542 | |
Sample (before weighting) | 118 |
Note: Coefficient = beta coefficient; *; **; and ***.
Discussion and Conclusions
Data Availability Statement
Acknowledgments
References
Information & Authors
Information
Published In
Copyright
History
ASCE Technical Topics:
- Business management
- Data analysis
- Disaster risk management
- Disasters and hazards
- Economic factors
- Engineering fundamentals
- Field tests
- Hurricanes, typhoons, and cyclones
- Infrastructure
- Lifeline systems
- Measurement (by type)
- Methodology (by type)
- Metric systems
- Natural disasters
- Practice and Profession
- Research methods (by type)
- Social factors
- Tests (by type)
- Utilities