A Bernoulli Formulation of the Land-Use Portfolio Model

Decision making for natural-hazards mitigation can be sketched as knowledge available in advance (a priori), knowledge available later (a posteriori), and how consequences of the mitigation decision might be viewed once future outcomes are known. Two outcomes - mitigating for a hazard event that will occur, and not mitigating for a hazard event that will not occur - can be considered narrowly correct. Two alternative outcomes - mitigating for a hazard event that will not occur, and not mitigating for a hazard event that will occur - can be considered narrowly incorrect. The dilemma facing the decision maker is that mitigation choices must be made before the event, and often must be made with imperfect statistical techniques and imperfect data.