{"product_id":"operational-safety-economics-9781118871126","title":"Operational Safety Economics","description":"\u003cb\u003eBook Synopsis\u003c\/b\u003e\u003cbr\u003e\u003cp\u003eDescribes how to make economic decisions regading safety in the chemical and process industries\u003c\/p\u003e \u003cul\u003e \u003cli\u003eCovers both technical risk assessment and economic aspects of safety decision-making\u003c\/li\u003e \u003cli\u003eSuitable for both academic researchers and practitioners in industry\u003c\/li\u003e \u003cli\u003eAddresses cost-benefit analysis for safety investments\u003c\/li\u003e \u003c\/ul\u003e\u003cbr\u003e\u003cbr\u003e\u003cb\u003eTable of Contents\u003c\/b\u003e\u003cbr\u003e\u003cp\u003ePreface xi\u003c\/p\u003e \u003cp\u003eDisclaimer xiv\u003c\/p\u003e \u003cp\u003eAcknowledgements xv\u003c\/p\u003e \u003cp\u003eList of Acronyms xvii\u003c\/p\u003e \u003cp\u003e\u003cb\u003e1 Introduction 1\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e1.1 The “Why” of Operational Safety 1\u003c\/p\u003e \u003cp\u003e1.2 Back to the Future: the Economics of Operational Safety 3\u003c\/p\u003e \u003cp\u003e1.3 Difficulties in Operational Safety Economics 4\u003c\/p\u003e \u003cp\u003e1.4 The Field of Operational Safety within the Profitability of an Organization 5\u003c\/p\u003e \u003cp\u003e1.5 Conclusions 6\u003c\/p\u003e \u003cp\u003eReferences 7\u003c\/p\u003e \u003cp\u003e\u003cb\u003e2 Operational Risk, Operational Safety, and Economics 8\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e2.1 Defining the Concept of Operational Risk 8\u003c\/p\u003e \u003cp\u003e2.2 Dealing with Operational Risks 10\u003c\/p\u003e \u003cp\u003e2.3 Types of Operational Risk 11\u003c\/p\u003e \u003cp\u003e2.4 The Importance of Operational Safety Economics for a Company 15\u003c\/p\u003e \u003cp\u003e2.5 Balancing between Productivity and Safety 18\u003c\/p\u003e \u003cp\u003e2.6 The Safety Equilibrium Situation or “HRO Safety” 19\u003c\/p\u003e \u003cp\u003e2.6.1 HRO Principle 1: Targeted at Disturbances 20\u003c\/p\u003e \u003cp\u003e2.6.2 HRO Principle 2: Reluctant for Simplification 21\u003c\/p\u003e \u003cp\u003e2.6.3 HRO Principle 3: Sensitive toward Implementation 21\u003c\/p\u003e \u003cp\u003e2.6.4 HRO Principle 4: Devoted to Resiliency 21\u003c\/p\u003e \u003cp\u003e2.6.5 HRO Principle 5: Respectful for Expertise 22\u003c\/p\u003e \u003cp\u003e2.7 The Egg Aggregated Model (TEAM) of Safety Culture 22\u003c\/p\u003e \u003cp\u003e2.8 Safety Futures 24\u003c\/p\u003e \u003cp\u003e2.9 The Controversy of Economic Analyses 25\u003c\/p\u003e \u003cp\u003e2.10 Scientific Requirements for Adequate Economic Assessment Techniques 26\u003c\/p\u003e \u003cp\u003e2.11 Four Categories of Data 27\u003c\/p\u003e \u003cp\u003e2.12 Improving Decision-making Processes for Investing in Safety 28\u003c\/p\u003e \u003cp\u003e2.13 Conclusions 29\u003c\/p\u003e \u003cp\u003eReferences 30\u003c\/p\u003e \u003cp\u003e\u003cb\u003e3 Economic Foundations 31\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e3.1 Macroeconomics and Microeconomics 31\u003c\/p\u003e \u003cp\u003e3.2 Safety Demand and Long-term Average Cost of Production 32\u003c\/p\u003e \u003cp\u003e3.2.1 Safety Demand 32\u003c\/p\u003e \u003cp\u003e3.2.2 Long-term Average Cost of Production and Safety 33\u003c\/p\u003e \u003cp\u003e3.3 Safety Value Function 35\u003c\/p\u003e \u003cp\u003e3.4 Expected Value Theory, Value at Risk, and Safety Attitude 37\u003c\/p\u003e \u003cp\u003e3.4.1 Expected Value Theory 37\u003c\/p\u003e \u003cp\u003e3.4.2 Value at Risk 38\u003c\/p\u003e \u003cp\u003e3.4.3 Safety Attitude 39\u003c\/p\u003e \u003cp\u003e3.5 Safety Utilities 40\u003c\/p\u003e \u003cp\u003e3.5.1 Safety Utility Functions 40\u003c\/p\u003e \u003cp\u003e3.5.2 Expected Utility and Certainty Equivalent 41\u003c\/p\u003e \u003cp\u003e3.6 Measuring Safety Utility Functions 42\u003c\/p\u003e \u003cp\u003e3.7 Preferences of Safety Management – Safety Indifference Curves 43\u003c\/p\u003e \u003cp\u003e3.8 Measuring Safety Indifference Curves 45\u003c\/p\u003e \u003cp\u003e3.8.1 Questionnaire-based Type I Safety Indifference Curves 45\u003c\/p\u003e \u003cp\u003e3.8.2 Problems with Determining an Indifference Curve 48\u003c\/p\u003e \u003cp\u003e3.8.3 Time Trade-off-based Safety Utilities for Type II Safety Indifference Curves 48\u003c\/p\u003e \u003cp\u003e3.9 Budget Constraint and n-Dimensional Maximization Problem Formulation 50\u003c\/p\u003e \u003cp\u003e3.10 Determining Optimal Safety Management Preferences within the Budget Constraint for a Two-dimensional Problem 52\u003c\/p\u003e \u003cp\u003e3.11 Conclusions 54\u003c\/p\u003e \u003cp\u003eReferences 54\u003c\/p\u003e \u003cp\u003e\u003cb\u003e4 Operational Safety Decision-making and Economics 55\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e4.1 Economic Theories and Safety Decisions 55\u003c\/p\u003e \u003cp\u003e4.1.1 Introduction 55\u003c\/p\u003e \u003cp\u003e4.1.2 Expected Utility Theory 56\u003c\/p\u003e \u003cp\u003e4.1.3 Prospect Theory 56\u003c\/p\u003e \u003cp\u003e4.1.4 Bayesian Decision Theory 60\u003c\/p\u003e \u003cp\u003e4.1.5 Risk and Uncertainty 60\u003c\/p\u003e \u003cp\u003e4.1.6 Making a Choice Out of a Set of Options 62\u003c\/p\u003e \u003cp\u003e4.1.7 Impact of Affect and Emotion in the Process of Making a Choice between Alternatives 64\u003c\/p\u003e \u003cp\u003e4.1.8 Influence of Regret and Disappointment on Decision-making 64\u003c\/p\u003e \u003cp\u003e4.1.9 Impact of Intuition on Decision-making 65\u003c\/p\u003e \u003cp\u003e4.1.10 Other Influences while Making Decisions 66\u003c\/p\u003e \u003cp\u003e4.2 Making Decisions to Deal with Operational Safety 66\u003c\/p\u003e \u003cp\u003e4.2.1 Introduction 66\u003c\/p\u003e \u003cp\u003e4.2.2 Risk Treatment Option 1: Risk Reduction 67\u003c\/p\u003e \u003cp\u003e4.2.3 Risk Treatment Option 2: Risk Acceptance 69\u003c\/p\u003e \u003cp\u003e4.2.4 Risk Treatment 70\u003c\/p\u003e \u003cp\u003e4.2.5 The “Human Aspect” of Making a Choice between Risk Treatment Alternatives 74\u003c\/p\u003e \u003cp\u003e4.3 Safety Investment Decision-making – a Question of Costs and Benefits 76\u003c\/p\u003e \u003cp\u003e4.3.1 Costs and Hypothetical Benefits 76\u003c\/p\u003e \u003cp\u003e4.3.2 Prevention Benefits 78\u003c\/p\u003e \u003cp\u003e4.3.3 Prevention Costs 78\u003c\/p\u003e \u003cp\u003e4.4 The Degree of Safety and the Minimum Overall Cost Point 79\u003c\/p\u003e \u003cp\u003e4.5 The Type I and Type II Accident Pyramids 83\u003c\/p\u003e \u003cp\u003e4.6 Quick Calculation of Type I Accident Costs 85\u003c\/p\u003e \u003cp\u003e4.6.1 Accident Metrics 86\u003c\/p\u003e \u003cp\u003e4.6.2 A Quick Cost-estimation Approach for Type I Risks 87\u003c\/p\u003e \u003cp\u003e4.7 Quick Calculation of Type II Accident Costs 88\u003c\/p\u003e \u003cp\u003e4.7.1 Introduction to a Study on Type II Event Decision-making 88\u003c\/p\u003e \u003cp\u003e4.7.2 Results of the Study on Type II Event Decision-making 90\u003c\/p\u003e \u003cp\u003e4.7.3 Results by Gender 92\u003c\/p\u003e \u003cp\u003e4.7.4 Rational and Intuitive Thinking Styles 92\u003c\/p\u003e \u003cp\u003e4.7.5 Conclusions of the Study on Type II Event Decision-making 94\u003c\/p\u003e \u003cp\u003e4.8 Costs and Benefits and the Different Types of Risk 95\u003c\/p\u003e \u003cp\u003e4.9 Marginal Safety Utility and Decision-making 97\u003c\/p\u003e \u003cp\u003e4.10 Risk Acceptability, Risk Criteria, and Risk Comparison – Moral Aspects and Value of (Un)safety and Value of Human Life 101\u003c\/p\u003e \u003cp\u003e4.10.1 Risk Acceptability 101\u003c\/p\u003e \u003cp\u003e4.10.2 Risk Criteria and Risk Comparison 104\u003c\/p\u003e \u003cp\u003e4.10.3 Economic Optimization 110\u003c\/p\u003e \u003cp\u003e4.10.4 Moral Aspects and Calculation of (Un)safety, Monetizing Risk and Value of Human Life 111\u003c\/p\u003e \u003cp\u003e4.11 Safety Investment Decision-making for the Different Types of Risk 123\u003c\/p\u003e \u003cp\u003e4.11.1 Safety Investment Decision-making in the Case of Type I Risks 123\u003c\/p\u003e \u003cp\u003e4.11.2 Safety Investment Decision-making for Type II Risks 126\u003c\/p\u003e \u003cp\u003e4.11.3 Calculation of the Disproportion Factor, taking Societal Acceptability of Risks into Account 130\u003c\/p\u003e \u003cp\u003e4.12 Conclusions 142\u003c\/p\u003e \u003cp\u003eReferences 142\u003c\/p\u003e \u003cp\u003e\u003cb\u003e5 Cost-Benefit Analysis 149\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e5.1 An Introduction to Cost-Benefit Analysis 149\u003c\/p\u003e \u003cp\u003e5.2 Economic Concepts Related to Cost-Benefit Analyses 150\u003c\/p\u003e \u003cp\u003e5.2.1 Opportunity Cost 150\u003c\/p\u003e \u003cp\u003e5.2.2 Implicit Value of Safety 151\u003c\/p\u003e \u003cp\u003e5.2.3 Consistency and Uniformity of Safety Investment Decisions 152\u003c\/p\u003e \u003cp\u003e5.2.4 Decision Rule, Present Values, and Discount Rate 154\u003c\/p\u003e \u003cp\u003e5.2.5 Different Cost-Benefit Ratios 157\u003c\/p\u003e \u003cp\u003e5.3 Calculating Costs 158\u003c\/p\u003e \u003cp\u003e5.3.1 Safety Measures 158\u003c\/p\u003e \u003cp\u003e5.3.2 Costs of Safety Measures 158\u003c\/p\u003e \u003cp\u003e5.4 Calculating Benefits (Avoided Accident Costs) 175\u003c\/p\u003e \u003cp\u003e5.4.1 Distinction between Various Accident Costs 176\u003c\/p\u003e \u003cp\u003e5.4.2 Avoided Accident Costs 178\u003c\/p\u003e \u003cp\u003e5.4.3 Investment Analysis (Economic Concepts Related to Type I Risks) 200\u003c\/p\u003e \u003cp\u003e5.5 The Cost of Carrying Out Cost-Benefit Analyses 201\u003c\/p\u003e \u003cp\u003e5.6 Cost-Benefit Analysis for Type I Safety Investments 202\u003c\/p\u003e \u003cp\u003e5.7 Cost-Benefit Analysis for Type II Safety Investments 202\u003c\/p\u003e \u003cp\u003e5.7.1 Introduction 202\u003c\/p\u003e \u003cp\u003e5.7.2 Quantitative Assessment Using the Disproportion Factor 204\u003c\/p\u003e \u003cp\u003e5.7.3 Decision Model 206\u003c\/p\u003e \u003cp\u003e5.7.4 Simulation on Illustrative Case Studies 208\u003c\/p\u003e \u003cp\u003e5.7.5 Recommendations with Regard to Using the DF0 216\u003c\/p\u003e \u003cp\u003e5.8 Advantages and Disadvantages of Analyses Based on Costs and Benefits 216\u003c\/p\u003e \u003cp\u003e5.9 Conclusions 217\u003c\/p\u003e \u003cp\u003eReferences 217\u003c\/p\u003e \u003cp\u003e\u003cb\u003e6 Cost-effectiveness Analysis 219\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e6.1 An Introduction to Cost-effectiveness Analysis 219\u003c\/p\u003e \u003cp\u003e6.2 Cost-effectiveness Ratio 220\u003c\/p\u003e \u003cp\u003e6.3 Cost-effectiveness Analysis Using Constraints 222\u003c\/p\u003e \u003cp\u003e6.4 User-friendly Approach for Cost-effectiveness Analysis under Budget Constraint 223\u003c\/p\u003e \u003cp\u003e6.4.1 Input Information 223\u003c\/p\u003e \u003cp\u003e6.4.2 Approach Cost-effectiveness Working Procedure and Illustrative Example 225\u003c\/p\u003e \u003cp\u003e6.4.3 Illustrative Example of the Cost-effectiveness Analysis with Safety Budget Constraint 226\u003c\/p\u003e \u003cp\u003e6.4.4 Refinements of the Cost-effectiveness Approach 227\u003c\/p\u003e \u003cp\u003e6.5 Cost-effectiveness Calculation Often Used in Industry 232\u003c\/p\u003e \u003cp\u003e6.6 Cost–Utility Analysis 233\u003c\/p\u003e \u003cp\u003e6.7 Conclusions 233\u003c\/p\u003e \u003cp\u003eReferences 233\u003c\/p\u003e \u003cp\u003e\u003cb\u003e7 Beyond the State-of the Art of Operational Safety Economics: Bayesian Decision Theory 235\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e7.1 Introduction 235\u003c\/p\u003e \u003cp\u003e7.2 Bayesian Decision Theory 237\u003c\/p\u003e \u003cp\u003e7.2.1 The Criterion of Choice as a Degree of Freedom 237\u003c\/p\u003e \u003cp\u003e7.2.2 The Proposed Criterion of Choice 240\u003c\/p\u003e \u003cp\u003e7.2.3 The Algorithmic Steps of the Bayesian Decision Theory 241\u003c\/p\u003e \u003cp\u003e7.3 The Allais Paradox 241\u003c\/p\u003e \u003cp\u003e7.3.1 The Choosing of Option 1B 242\u003c\/p\u003e \u003cp\u003e7.3.2 The Choosing of Option 2A 243\u003c\/p\u003e \u003cp\u003e7.3.3 How to Resolve an Allais Paradox 245\u003c\/p\u003e \u003cp\u003e7.4 The Ellsberg Paradox 245\u003c\/p\u003e \u003cp\u003e7.5 The Difference in Riskiness Between Type I and Type II Events 247\u003c\/p\u003e \u003cp\u003e7.5.1 Outcome Probability Distributions with Equal Expectation Values 247\u003c\/p\u003e \u003cp\u003e7.5.2 The Risk of the Type I Event 248\u003c\/p\u003e \u003cp\u003e7.5.3 The Risk of the Type II Event 249\u003c\/p\u003e \u003cp\u003e7.5.4 Comparing the Risks of the Type I and Type II Events 250\u003c\/p\u003e \u003cp\u003e7.6 Discussion 251\u003c\/p\u003e \u003cp\u003e7.7 Conclusions 253\u003c\/p\u003e \u003cp\u003eReferences 253\u003c\/p\u003e \u003cp\u003e\u003cb\u003e8 Making State-of-the-Art Economic Thinking Part of Safety Decision-making 254\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e8.1 The Decision-making Process for an Economic Analysis 254\u003c\/p\u003e \u003cp\u003e8.2 Application of Cost-Benefit Analysis to Type I Risks 256\u003c\/p\u003e \u003cp\u003e8.2.1 Safety Investment Option 1 257\u003c\/p\u003e \u003cp\u003e8.2.2 Safety Investment Option 2 259\u003c\/p\u003e \u003cp\u003e8.3 Decision Analysis Tree Approach 262\u003c\/p\u003e \u003cp\u003e8.3.1 Scenario Thinking Approach 263\u003c\/p\u003e \u003cp\u003e8.3.2 Cost Variable Approach 263\u003c\/p\u003e \u003cp\u003e8.4 Safety Value Function Approach 267\u003c\/p\u003e \u003cp\u003e8.5 Multi-attribute Utility Approach 270\u003c\/p\u003e \u003cp\u003e8.6 The Borda Algorithm Approach 272\u003c\/p\u003e \u003cp\u003e8.7 Bayesian Networks in Relation to Operational Safety Economics 274\u003c\/p\u003e \u003cp\u003e8.7.1 Constructing a Bayesian Network 274\u003c\/p\u003e \u003cp\u003e8.7.2 Modeling a Bayesian Network to Analyze Safety Investment Decisions 276\u003c\/p\u003e \u003cp\u003e8.8 Limited Memory Influence Diagram (LIMID) Approach 280\u003c\/p\u003e \u003cp\u003e8.9 Monte Carlo Simulation for Operational Safety Economics 284\u003c\/p\u003e \u003cp\u003e8.10 Multi-criteria Analysis (MCA) in Relation to Operational Safety Economics 286\u003c\/p\u003e \u003cp\u003e8.11 Game Theory Considerations in Relation to Operational Safety Economics 292\u003c\/p\u003e \u003cp\u003e8.11.1 An Introduction to Game Theory 292\u003c\/p\u003e \u003cp\u003e8.11.2 The Prisoner’s Dilemma Game 294\u003c\/p\u003e \u003cp\u003e8.11.3 The Prisoner’s Dilemma Game Involving Many Players 295\u003c\/p\u003e \u003cp\u003e8.12 Proving the Usefulness of a Disproportion Factor (DF) for Type II Risks: an Illustrative (Toy) Problem 297\u003c\/p\u003e \u003cp\u003e8.12.1 The Problem of Choice 297\u003c\/p\u003e \u003cp\u003e8.12.2 The Expected Outcome Theory Solution 298\u003c\/p\u003e \u003cp\u003e8.12.3 The Expected Utility Solution 299\u003c\/p\u003e \u003cp\u003e8.12.4 The Bayesian Decision Theory Solution 300\u003c\/p\u003e \u003cp\u003e8.12.5 A Numerical Example Comparing Expected Outcome Theory, Expected Utility Theory, and Bayesian Decision Theory 302\u003c\/p\u003e \u003cp\u003e8.12.6 Discussion of the Illustrative (Toy) Problem – Link with the Disproportion Factor 304\u003c\/p\u003e \u003cp\u003e8.13 Decision Process for Carrying Out an Economic Analysis with Respect to Operational Safety 305\u003c\/p\u003e \u003cp\u003e8.14 Conclusions 308\u003c\/p\u003e \u003cp\u003eReferences 309\u003c\/p\u003e \u003cp\u003e\u003cb\u003e9 General Conclusions 310\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eIndex 313\u003c\/p\u003e","brand":"John Wiley \u0026 Sons Inc","offers":[{"title":"Default Title","offer_id":49528839340375,"sku":"9781118871126","price":100.76,"currency_code":"GBP","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0817\/1739\/5799\/files\/9781118871126.jpg?v=1731873225","url":"https:\/\/bookcurl.com\/products\/operational-safety-economics-9781118871126","provider":"Book Curl","version":"1.0","type":"link"}