There are two aspects to the mitigation of earthquake effects: the expected reduction of property damage and economic loss due to earthquakes and the expected reduction of the expected number of casualties. The reduction of property damage and economic loss is sufficient to compensate for the initial costs incurred; the corresponding measures are justified by financial gain alone. However, in the San Francisco Bay Area, the initial costs are higher than the expected financial benefit. In this case, expenditures are justified by the expected number of lives saved.

The consistency of public choices requires measures to increase the cost per life saved. This means that the optimality of public expenditures depends upon the marginal return of each investment; measures that save more lives for the same investment should be taken first so that the total number of lives saved for a given public investment is maximized.

Mitigation of Earthquake

This study assumes that all lives have the same priority and that all other benefits have been considered by subtraction from the initial cost. Ultimately, the public must decide on a certain level of security. The decision varies among nations according to social and philosophical considerations, economic conditions, and political situations. There is a variable demand for safety investments as opposed to production investments.

Political pressures on legislative bodies reflect society’s willingness to pay for individual safety. Ideally, the level of seismic safety required should be consistent with choices made by another public sector. It should also reflect individual preferences as revealed by private choices in other areas.

This means two things: first, the risks that an individual has to take independently of his will should be compatible with those that he willingly takes from other comparable hazards; second, the costs that society imposes on him for reducing these risks should be consistent with his private expenditures for reducing similar risks.

Determining an “acceptable level of seismic risk” is difficult since there is no collective utility function and global risk attitude for an entire population. The law can only impose a minimal safety level and leave individuals the choice of adopting further improvements.