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Aviation Security, Risk Assessment, and Risk Aversion for Public Decisionmaking

July 31, 2014 10:00 AM

In Aviation Security, Risk Assessment, and Risk Aversion for Public Decisionmaking, authors Mark G. Stewart and John Mueller estimates risk reductions for each layer of security designed to prevent commercial passenger airliners from being commandeered by terrorists, kept under control for some time, and then crashed into specific targets. Probabilistic methods are used to characterize the uncertainty of rates of deterrence, detection, and disruption, as well as losses. Since homeland security decisionmakers tend to be risk-averse because of the catastrophic or dire nature of the hazard or event, utility theory and Monte Carlo simulation methods are used to propagate uncertainties in calculations of net present value, expected utility, and probabilities of net benefit.

The authors employ a “break-even” cost-benefit analysis to determine the minimum probability of an otherwise successful attack that is required for the benefit of security measures to equal their cost. Stewart and Mueller examine specific policy options: including Improvised Physical Secondary Barriers (IPSBs) in the array of aircraft security measures, including the Federal Air Marshal Service (FAMS), and including them both.

A risk-neutral analysis finds a policy option of adding IPSBs but not FAMS to the other measures to be preferred for all attack probabilities. However, a very risk-averse decisionmaker is 48 percent likely to prefer to retain FAMS even if the attack probability is as low as one percent per year—a level of risk aversion exhibited by few, if any, government agencies.

Overall, it seems that, even in an analysis that biases the consideration toward the opposite conclusion, far too much may currently be spent on security measures to address the problem of airline hijacking, and many spending reductions could likely be made with little or no consequent reduction of security.

Read the full paper at WileyOnline.


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