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Economic Approaches to Homeland Security for Constructed Facilities



Harold E. Marshall


The 11 September 2001 terrorist attack on the New York World Trade Center (WTC) Complex and the Pentagon changed dramatically the way buildings, industrial facilities, and infrastructure will be designed, sited, and managed in the United States. The magnitude of losses has forced the owners and managers of constructed facilities, both private and public, to include in their decision-making the possibility of terrorist attacks on their property. This paper presents economic models of how to choose in a financially responsible manner among protective strategies designed to reduce the expected value of terrorist-induced damages. The life-cycle cost and net savings models help the user choose the cost-effective level of investment in a given protective strategy (say hardening the building against fire and explosives). They also help users choose the optimal combination of protective strategies (say hardening the building; upgrading the heating, ventilating and air conditioning system against biological contamination; or increasing security to prevent terrorist encroachment), when each strategy in itself is cost effective, but inadequate funds preclude implementing all cost-effective strategies. The paper proposes additional research needs on the treatment of interdependencies in protection measures and the optimal timing of investments for protection. It describes spillover benefits from protection against terrorism, why most resources will be allocated to the protection of existing buildings, and how decision-making perspectives regarding protection against terrorism may differ between private and public facility managers. Finally, it describes desirable characteristics of a software product that could be used to implement the described economic models. Expected economic impacts of such a product will be a decrease in the expected value of terrorist-induced losses (i.e., a decrease in deaths, injuries and damages from terrorist attacks); a decrease in damages and injuries stemming from other disasters that affect buildings--fire, floods, and high winds; and additional spillover benefits from reduced burglary and vandalism.
Proceedings Title
10th Joint W055-W065 International Symposium on Construction Innovatin and Global Competitiveness
Conference Dates
September 9-13, 2002
Conference Title
International Symposium on Construction Innovation and Global Competitiveness


Building economics, cost effective dynamic programming, homeland security, life-cycle costing, net savings, options analysis, terrorism protection, terrorism software


Marshall, H. (2002), Economic Approaches to Homeland Security for Constructed Facilities, 10th Joint W055-W065 International Symposium on Construction Innovatin and Global Competitiveness (Accessed April 23, 2024)
Created September 1, 2002, Updated February 19, 2017