Economic impact of 'dirty bomb' researched

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LOS ANGELES, April 23 (UPI) -- A "dirty bomb" attack in downtown Los Angeles could severely hit the region's economy and cost nearly $16 billion in a decade, researchers say.

Economists and scientists writing in the journal Risk Analysis said the long-term costs of such an attack would be fueled primarily by psychological effects that could persist for a decade.

"We decided to study a terrorist attack on Los Angeles not to scare people, but to alert policymakers just how large the impact of the public's reaction might be," said study co-author William Burns, a research scientist at Decision Research in Eugene, Ore.

The immediate economic costs of such a terrorist event, in terms of injuries, cleanup and business closures, would likely exceed $1 billion, the researchers said, but the economic impact would continue for a long time.

"Terrorism can have a much larger impact than first believed," study co-author Adam Rose, a research professor with the USC Price School of Public Policy, said in a university release Monday.

People would remain wary of shopping or dining in the financial district for an extended period, the research showed, and employees would demand an average 25 percent increase in wages to return to their jobs in the affected area.

"The economic effects of the public's change in behavior are 15 times more costly than the immediate damage in the wake of a disaster," Rose said.