Bushfires destroy existing resources while fire prevention and suppression require resources that have alternative uses. Consequently, the threat of bushfires alters resource allocation affecting the well being (welfare status in the language of economics) of society. This paper explores the potential of using an economic framework to improve bushfire management through better use of scarce resources. The effect of bushfires on the resource base and associated socio-economic impacts, resource allocation for fire management, and public policy issues are some areas of interest for economic analysts. The uncertainty of the potential damage from unmanaged fire events and the impact of infrequent and massive fire events on regional economies are some of the challenges for analysts attempting to introduce economic thinking into fire management decision-making. Economics provides a standard framework for valuing resources damaged by bushfire and human suffering. Impact assessment of major bushfire events on regional economies, and resource allocation for different programs are also areas where economic methodologies can help by better allocation of scarce resources.
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