Changes

[[File:Risk_2.jpg]]

[[File:Risk_2.jpg]]

One of the first major uses of this [[concept]] was at the planning of the [http://en.wikipedia.org/wiki/Delta_Works Delta Works] in 1953, a flood protection program in the Netherlands, with the aid of the mathematician [http://en.wikipedia.org/wiki/David_van_Dantzig David van Dantzig].[4] The kind of risk [[analysis]] pioneered here has become common today in fields like [http://en.wikipedia.org/wiki/Nuclear_power nuclear power], [http://en.wikipedia.org/wiki/Aerospace aerospace] and [http://en.wikipedia.org/wiki/Chemical_industry chemical industry].

One of the first major uses of this [[concept]] was at the planning of the [https://en.wikipedia.org/wiki/Delta_Works Delta Works] in 1953, a flood protection program in the Netherlands, with the aid of the mathematician [https://en.wikipedia.org/wiki/David_van_Dantzig David van Dantzig].[4] The kind of risk [[analysis]] pioneered here has become common today in fields like [https://en.wikipedia.org/wiki/Nuclear_power nuclear power], [https://en.wikipedia.org/wiki/Aerospace aerospace] and [https://en.wikipedia.org/wiki/Chemical_industry chemical industry].

There are more sophisticated definitions, however. [[Measuring]] [[engineering]] risk is often difficult, especially in potentially dangerous industries such as nuclear energy. Often, the [[probability]] of a negative event is estimated by using the frequency of past similar events or by event-tree methods, but probabilities for rare failures may be difficult to estimate if an event tree cannot be formulated. [[Methods]] to calculate the cost of the loss of human life vary depending on the purpose of the calculation. Specific [[method]]s include what people are willing to pay to insure against death,[5] and radiological release (e.g., GBq of radio-iodine).  There are many [[formal]] [[method]]s used to assess or to "measure" risk, considered as one of the critical indicators important for human [[decision]] making.

There are more sophisticated definitions, however. [[Measuring]] [[engineering]] risk is often difficult, especially in potentially dangerous industries such as nuclear energy. Often, the [[probability]] of a negative event is estimated by using the frequency of past similar events or by event-tree methods, but probabilities for rare failures may be difficult to estimate if an event tree cannot be formulated. [[Methods]] to calculate the cost of the loss of human life vary depending on the purpose of the calculation. Specific [[method]]s include what people are willing to pay to insure against death,[5] and radiological release (e.g., GBq of radio-iodine).  There are many [[formal]] [[method]]s used to assess or to "measure" risk, considered as one of the critical indicators important for human [[decision]] making.

In [[statistics]], risk is often mapped to the [[probability]] of some [[event]] which is seen as undesirable. Usually, the probability of that event and some assessment of its expected harm must be combined into a believable scenario (an outcome), which combines the set of risk, regret and reward probabilities into an expected value for that outcome. (See also Expected utility.)

In [[statistics]], risk is often mapped to the [[probability]] of some [[event]] which is seen as undesirable. Usually, the probability of that event and some assessment of its expected harm must be combined into a believable scenario (an outcome), which combines the set of risk, regret and reward probabilities into an expected value for that outcome. (See also Expected utility.)

Thus, in [http://en.wikipedia.org/wiki/Decision_theory statistical decision theory], the risk [[function]] of an estimator δ(x) for a parameter θ, calculated from some observables x, is defined as the expectation value of the loss function L,

Thus, in [https://en.wikipedia.org/wiki/Decision_theory statistical decision theory], the risk [[function]] of an estimator δ(x) for a parameter θ, calculated from some observables x, is defined as the expectation value of the loss function L,

[[File:Loss_function.jpg]]

[[File:Loss_function.jpg]]

In [http://en.wikipedia.org/wiki/Information_security information security], a risk is written as an asset, the threats to the asset and the vulnerability that can be exploited by the threats to impact the asset - an example being: Our desktop computers (asset) can be compromised by malware (threat) entering the environment as an email attachment (vulnerability).

In [https://en.wikipedia.org/wiki/Information_security information security], a risk is written as an asset, the threats to the asset and the vulnerability that can be exploited by the threats to impact the asset - an example being: Our desktop computers (asset) can be compromised by malware (threat) entering the environment as an email attachment (vulnerability).

The risk is then assessed as a function of three variables:

The risk is then assessed as a function of three variables:

The two probabilities are sometimes combined and are also known as likelihood. If any of these variables approaches zero, the overall risk approaches zero.

The two probabilities are sometimes combined and are also known as likelihood. If any of these variables approaches zero, the overall risk approaches zero.

The management of actuarial risk is called [http://en.wikipedia.org/wiki/Risk_management risk management].[http://en.wikipedia.org/wiki/Risk]

The management of actuarial risk is called [https://en.wikipedia.org/wiki/Risk_management risk management].[https://en.wikipedia.org/wiki/Risk]

[[Category: Statistics]]

[[Category: Statistics]]