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It would have been ridiculous, not too long ago, to admit openly that you were thinking about asteroids and comets slamming into the Earth. Such events could mean the end of the world as we know it — TEOTWAWKI as millenialists call it — and that kind of talk is often ridiculed. Then again, it would have been ridiculous, not too long ago, to think that two hijacked 767s would slam into the World Trade Center and make both towers fall. Thinking about NEOs is becoming more commonplace, although not entirely normal.

Perhaps the earliest studies of risk perception with regard to natural hazards were conducted by geographer Gilbert White (1945, 1964) and his students (e.g. ). Later, in 1974, this author joined with White and economist Howard Kunreuther to review this early work in the context of new research in cognitive psychology (; , ) describing the idiosyncratic ways human minds think about probability, uncertainty and risk (). This research illustrated the workings of Herbert Simon’s theory of “bounded rationality” (1959), which asserts that human cognitive limitations force decision makers to construct a simplified model of the world in order to deal with it.

Estimation of the risk of any natural hazard is problematic when occurrences are very rare and predictions are based on sparse data. While some natural hazards are perceived as totally random phenomenon, in some cases improved monitoring techniques and models have heightened awareness and allowed for better disaster mitigation strategies (e.g. alerts, evacuations, long-term best management practices) to be implemented (e.g. ; ; ). Volcanic eruptions are examples of hazards where improved techniques for monitoring dome growth, seismic conditions, air chemistry and even groundwater can help forecast the onset of a major eruption (e.g. ; ; ). Now it is often the very infrequent hazards related to volcanic eruptions (e.g. pyroclastic flows, lahars, dome collapses) that inflict the most damage due to their lower predictability (; ; ). For most natural disasters, such ‘secondary’ hazards must be considered in hazard risk assessments and mitigation measures. Although it is known that the Earth has been impacted by asteroids in the past large enough to annihilate most life on the contemporary planet (; ; ; ; ), many of these isolated occurrences remain undiscovered.

Until quite recently, research into comet and asteroid hazards was focused on establishing the scale and scope of past impacts, credible estimates of their recurrence, and models for physical impact scenarios. If there is still much to be done, the threat does seem convincingly demonstrated. CAI hazards have moved well beyond the realm of ungrounded speculation and apocalyptic visions. The results represent more than just new findings. They revolutionize, or are about to revolutionize, some basic understandings about the Earth, its history, biological evolution and future. Although human life has had a tiny place in the story so far, our longer term fate seems to be challenged by these forces and may be decided by them.

The possible influence of impacts of celestial bodies on the evolution of life on Earth has been brought to the attention of the scientific community in 1980, with the publication of a famous paper by Alvarez et al. (1980) on the event that caused the mass extinction at the boundary between the Cretaceous and the Tertiary, 65 million years ago.

It is important not to let the potential magnitude of the impact from a comet or asteroid impact (CAI) skew discussion. Without doubt the energy released, hence consequences, from an ocean or terrestrial impact would be very large (, pp 231–235; , pp 133–158). An impact in the world ocean (approximately 71% of our planet’s surface), could affect much of humanity living in large coastal cities and other coastal settlements. Recent trends in urbanization and migration to coastal areas have placed many hundreds of millions of people in harm’s way (, Chap. 2 and 7). <1> A terrestrial impact on a heavily populated area is highly unlikely since humanity’s cities cover such a very small percentage of the Earth’s surface (only about 2–3%). Yet their “ecological footprint” is many times greater — 15 times as great in the case of greater Vancouver (Canada), 13 times in the case of the whole of the densely populated Netherlands (. So in both the case of destruction of coastal cities by large tsunami and an impact on a major urban area, there arises the question of providing for survivors and displaced evacuees (if current or future tsunami warning systems can provide sufficient warning). The challenge of immediate relief (provision of water, food, shelter, sanitation, and medical assistance to survivors) following a tsunami produced by a CAI can be imagined by multiplying the logistical efforts required by the Asian tsunami (December 2005) or the impact of hurricane Katrina on New Orleans and the Gulf Coast (August 2005) by an order of magnitude.

On the evening of June 18, 1178, several witnesses near Canterbury, England saw a spectacular night sky event (). These observers reported directly to a monk who was keeping detailed records of events occurring in or around Christ Church Cathedral. Fortunately, this diary, the has survived and provides a detailed description of the strange events of 1178:

An asteroid or comet will threaten a major urban center sometime in the future. It is very unlikely to happen this year, but some day it will happen. The potential damage will be catastrophic. A typical property insurance policy promises coverage for damage caused by such an impact, but there are limits to the capacity of insurance to pay. Moreover, damage from an asteroid or comet strike in a major urban center does not fit the principles of insurance coverage, so insurers may use the months or years between detection and impact to exclude this peril in insurance policy renewals that take place before the strike occurs. National and international policy makers should develop preparedness plans assuming that they will manage society’s recovery from an asteroid or comet strike in a major urban center, including responsibility for financial matters.

The objective of this paper is to investigate the economic consequences of asteroid or comet impacts, referred to here as (NEO). As of September 8, 2005, according to the Near Earth Objects Program of NASA (NASA 2005), there are 3535 NEOs, of which asteroids (NEAs) are 3438. NEAs greater than 1 km in diameter are represented by 797. The number of potentially hazardous asteroids (PHAs) is 720, of which PHAs greater than 1 km are 146. Of these, 3 appear (on September 8, 2005) on the NASA “impact risk” page. An NEO that is less than 50 meters would have a 5 megaton energy impact, although NEOs of even less than 30 meters could be damaging, depending on their composition and density. From about 50 meters to about 1 km diameter, an impacting NEO can do tremendous damage on a local scale. With an energy level above a million megatons (diameter about 2 km), an impact will produce severe environmental damage on a global scale. Still larger impacts can cause mass extinctions, such as the one that ended the age of the dinosaurs 65 million years ago (15 km diameter and about 100 million megatons). Table 29.1, reproduced from Chapman (Chap. 7 of this volume) is instructive; it summarizes impact energies and possible physical damages.

The first conscious recollection I have from my childhood was an aerial bombing. It was a beautiful summer afternoon in June 1940, in a small French village east of Paris. Fortunately no one in my family was hurt. During the following four years, with other children of my age, I was often pulled out from home and school by siren whistles announcing airplanes approaching. In none of these cases was there panic: the adults and children had been trained to react instantaneously and to seek refuge in vaulted cellars or in trenches.