The Ostrich Paradox: Why We Underprepare for Disasters

The Ostrich Paradox: Why We Underprepare for Disasters by Robert Meyer and Howard Kunreuther

People are stupid. They are bad at math. They underestimate the chance of bad things happening to them, except when they overestimate the chance of bad things happening. 

Upon hearing that an evacuation order may come, most people say they will obey. When the order finally does come, a much lower percentage actually evacuate. The theoretical ends up being more challenging when it requires immediate work. They also discover that they are not well-prepared for the individual moment. The evacuation ends up taken longer than predicted. 

The September 11th destructions of the World Trade Centers show both sides of the reaction. Before the attacks, there had been other attempts to destroy the towers. Yet, when the owner sought to ensure the tours, there was no special treatment given to acts of terror. It was covered with any other peril. Smart people and companies greatly underestimated the chance of a terrorist attack. Afterwards, people greatly overestimated the chance of further planes flying into buildings. Many people drove instead of flying, even though driving had a must greater chance of injury.

Equity concerns and resiliency also play a role in bad behavior.  It feels unfair to have some people in riskier areas pay higher insurance costs - especially when these are poorer. Thus homeowners in areas susceptible to fires or flooding end up getting insurance that is subsidized by others. They have difficulty seeing their true costs. Then when their property is destroyed, they show their resilience by building right back in the same place, rather than in safer places. These forces make it difficult to appropriately price and plan for bad disasters.

There are ways we can help fix our behavior as a society or individuals. However, it is challenging. There is likely to be more "head in the sand" in the face of disasters.