Risk Analysis in Engineering and Economics is required reading for decision making under conditions of uncertainty. The author describes the fundamental concepts, techniques, and applications of the subject in a style tailored to meet the needs of students and practitioners of engineering, science, economics, and finance. Drawing on his extensive experience in uncertainty and risk modeling and analysis, the author covers everything from basic theory and key computational algorithms to data needs, sources, and collection. He emphasizes practical use of the methods presented and carefully examines the limitations, advantages, and disadvantages of each to help readers translate the discussed techniques into real-world solutions.
This Second Edition:
Introduces the topic of risk finance
Incorporates homeland security applications throughout
Offers additional material on predictive risk management
Includes a wealth of new and updated end-of-chapter problems
Delivers a complementary mix of theoretical background and risk methods
Brings together engineering and economics on balanced terms to enable appropriate decision making
Presents performance segregation and aggregation within a risk framework
Contains contemporary case studies, such as protecting hurricane-prone regions and critical infrastructure
Provides 320+ tables and figures, over 110 diverse examples, numerous end-of-book references, and a bibliography
Unlike the classical books on reliability and risk management, Risk Analysis in Engineering and Economics, Second Edition relates underlying concepts to everyday applications, ensuring solid understanding and use of the methods of risk analysis.
Bilal M. Ayyub is professor of civil and environmental engineering at University of Maryland, College Park and director of the Center for Technology and Systems Management at A. James Clark School of Engineering. Highly decorated and widely published, he holds degrees from Kuwait University and the Georgia Institute of Technology. A fellow of ASCE, ASME, SRA, and SNAME, as well as a senior member of IEEE, he has completed research and development projects for entities including the National Science Foundation, U.S. Air Force, U.S. Coast Guard, Army Corps of Engineers, Navy, Department of Homeland Security, and private insurance and engineering firms.
Introduction Societal Needs Risk Analysis System Framework Knowledge and Ignorance Exercise Problems Risk Analysis Methods Introduction Risk Terminology Risk Assessment Risk Management and Control Risk Communication Exercise Problems System Definition and Structure Introduction System Definition Models Hierarchical Definitions of Systems System Complexity Exercise Problems Reliability Assessment Introduction Analytical Performance-Based Reliability Assessment Empirical Reliability Analysis Using Life Data Bayesian Methods Reliability Analysis of Systems Exercise Problems Failure Consequences and Severity Introduction Analytical Consequence and Severity Assessment Real Property Damage Loss of Human Life Injuries Indirect Losses Public Health and Ecological Damages Exercise Problems Engineering Economics and Finance Introduction Fundamental Economic Concepts Cash-Flow Diagrams Interest Formulae Economic Equivalence Involving Interest Economic Equivalence and Inflation Economic Analysis of Alternatives Exercise Problems Risk Control Methods Introduction Philosophies of Risk Control Risk Aversion in Investment Decisions Risk Homeostasis Insurance for Loss Control and Risk Transfer Benefit-Cost Analysis Risk-Based Maintenance Management Exercise Problems Data for Risk Studies Introduction Data Sources Databases Expert-Opinion Elicitation Model Modification Based on Available Data Failure Data Sources Exercise Problems Fundamentals of Probability and Statistics Sample Spaces, Sets, and Events Mathematics of Probability Random Variables and Their Probability Distributions Failure Data References and Bibliography Index