Economic dimensions of environmental and technological risk events: Toward a tenable taxonomy

The design of taxonomies can be a useful first step in theory building. Several social-science disciplines interested in human responses to hazards and disasters have successfully employed classificatory approaches to provide foundations for more detailed theorizing. In recent years, debate regarding the appropriateness of various typologies to organize environmental and technological risk events has been particularly pronounced in the fields of sociology and psychology. In contrast, economic research regarding catastrophic phenomena has proceeded ad hoc without an appropriate means of categorizing aversive agents. To encourage development of a conceptual framework for the economic dimensions of risk events, this article introduces a taxonomy referred to as a local economic impact continuum (LEIC). This classificatory scheme differentiates environmental and technological risk events into five categories: immediate-onset natural disasters, physical-impact technological accidents, human-impact technological accidents, chronic technical disasters, and chronic natural disasters. By characterizing ideal types and focusing on the relative ambiguity inherent in the aversive agent, this taxonomy can distinguish the local economic impacts generated by these incidents.