Course Syllabus: PPD 587
Risk Analysis (4 Units)
Catalogue Description
Concepts of risk analysis, risks in engineered systems, environmental risks, security risks;
methods of risk analysis, fault trees and event trees; quantification of probabilities, use of
data, models, and expert judgments; risks and decisions, interlinking risk analysis with
risk management; applications to homeland security decisions.
Recommended preparation: MATH 108 or MATH 116
Instructor - Detlof von Winterfeldt
Office:
Office Hours:
Telephone:
e-mail:
RTH 316A
Thursdays 4-6 PM
(213) 740 0898
detlof@sppd.usc.edu
Class Time and Location
Class Time:
Location:
Thursdays 6:00 to 9:00PM
Additional time for project discussions will be scheduled separately,
approximately 30 minutes for each project per week
Olin Hall of Engineering (OHE), Room 120
Readings
Kammen, D.H., and Hassenzahl, D,M. Should We Risk It? New Haven: Princeton
University Press, 1999. (K&H)
Edwards, W., Miles, R., and von Winterfeldt, D. (Eds). Advances in Decision Analysis.
Cambridge, UK: Cambridge University Press, March 2007 (advanced copies of
selected chapters on risk analysis will be posted on Blackboard). (EMvW)
Syllabus, PPD 587, Page 2
Overview
This class is an introduction to risk analysis in several fields, including engineering risk
analysis, environmental risk analysis, and security risk analysis. Many examples will
come from the homeland security area in connection with work that is being conducted at
USC’s Homeland Security Center for Risk and Economic Analysis of Terrorism Events.
Students will be introduced the concepts and methods of risk analysis and to software
tools and procedures that help the implementation of risk analysis. Students will also
learn how to apply risk analysis in real world settings.
Objectives
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Understand the basic concepts of risk analysis and the relationship between
probability theory and modeling, risk analysis, and decision analysis
Understand how to use probability, probabilistic modeling and probabilistic
simulation for risk analysis
Learn how to use the basic tools of risk analysis – fault trees, event trees,
simulation models, and influence diagrams
Learn how to use expert judgment in risk analysis
Understand the issues of using risk analysis in decision making, especially in
regulatory settings
Understanding risk management, including risk communication, implementation,
and monitoring of risk management strategies
Class Format
The class will be primarily in a lecture format. In addition, students will conduct a
simple risk analysis project of their own choice and present progress reports throughout
the class. The final examination class period will be devoted to final presentations of the
projects. Off-campus students can participate via WebX (presentations) and on the
discussion board. All students will submit a final report due three days after the final
presentation.
Tests and Grades
Grades will be assigned on the basis of class and discussion board (100 points),
homework assignments (six assignments of 50 points each for 300 points), the quality of
the four project presentations (50 points each for 200 points) and the final report (400
points).
Syllabus, PPD 587, Page 3
Disability Services and Programs Statement
Any student requesting academic accommodations based on a disability is required to
register with Disability Services and Programs (DSP) each semester. A letter of
verification for approved accommodations can be obtained from DSP. Please be sure the
letter is delivered to me (or to the TA) as early in the semester as possible. DSP is
located in STU 301 and is open 8:30 a.m. – 5:00 p.m., Monday through Friday. The
phone number for DSP is (213) 740-0776.
Academic Integrity Standards
Students are required to review USC’s academic integrity standards in the SCAMPUS
(www.usc.edu/department/publications/SCAMPUS/gov. Violations of any of the
academic integrity standards set by the University can have serious consequences.
Detlof von Winterfeldt - Biosketch
Detlof von Winterfeldt is the a Professor of Public Policy and Management at SPPD, a
Professor of Industrial and Systems Engineering at VSOE and the director of USC’s
Homeland Security Center for Risk and Economic Analysis of Terrorist Events
(CREATE). For the past thirty years, he has been active in teaching, research,
university administration, and consulting. He has taught courses in statistics, decision
analysis, risk analysis, systems analysis and human judgment and decision-making.
His research interests are in the foundation and practice of decision and risk analysis as
applied to technology, environmental, and terrorism problems. He is the co-author of
three books and author or co-author of over one hundred articles and reports on these
topics. His administrative experiences include serving as Deputy Dean of SPPD,
Associate Dean for Faculty and Research at SPPD, Director of SPPD’s Institute for
Civic Enterprise, Chairman of the Research Center at the Institute of Safety and
Systems Management (ISSM) and Chairman of ISSM’s Systems Science Department.
As a consultant he has applied decision and risk analysis to many management
problems of government and private industry. He has served on several committees
and panels of the National Science Foundation (NSF) and the National Research
Council (NRC), including recent appointments to the NRC’s Board on Mathematical
Sciences and their Applications and to the Committee for the Transportation of
Radioactive Waste. In 2000, the Decision Analysis Society awarded Dr. von
Winterfeldt the Ramsey Medal for distinguished contributions to decision analysis. He
is a fellow of the Society for Risk Analysis and of the Institute for Operations Research
and Management Science (INFORMS).
Syllabus, PPD 587, Page 4
Schedule - Risk Analysis PPD 587
Spring 2005
Week
Readings
Week 1
Week 2
Week 3
Week 4
Week 5
Week 6
Week 7
Date
1/11/2007
1/18/2007
1/25/2007
2/1/2007
2/8/2007
2/15/2007
2/22/2007
Topics
Introduction and overview of class; definition of risk; overview of risk
analysis; three examples
Getting started: Identifying and structuring risk problems; developing a
deterministic or parametric model
K&H 1
EMvW 6
Uncertainty, probability, and risk; review of probability and statistics
for risk analysis. First presentation: Three projects
Handouts
Continued review of probability and statistics for risk analysis;
classical and Bayesian statistics
K&H 3
How to obtain probabilities from experts; examples of major expert
elicitation exercises
EMvW 8
and 9
Handouts
Analytic approaches to risk analysis:
Event trees, fault trees, influence diagrams
EMvW
15
K&H 8
Simulation models (developing a deterministic model, sensitivity
analysis, probabilistic model); examples
Week 8
3/1/2007
Second presentation: Problem formulation, risk analysis approach,
plan for collecting data
Week 9
3/8/2007
Decision trees, expected value calculations, value of information,
introduction to multiattribute utility
K&H 4
K&H 9
Week 10
3/15/2007
SPRING BREAK
Week 11
3/22/2007
Introduction to game theory, comparison of game and decision theory
(Guest Speaker)
Reading
Applications of risk analysis to technological and environmental
problems
EMvW
16, 17
Week 12
3/29/2007
Week 13
4/5/2007
Week 14
4/12/2007
Week 15
Week 15
Week 16
4/19/2007
4/26/2007
5/3/2007
K&H 2
K&H
5&6
Third presentation: Update on problem and analysis approach,
preliminary report on probabilities and data
Applications of risk analysis to terrorism problems – terrorist attacks
and countermeasures (Guest Speaker)
Risk management: Decision making and resource allocation (Guest
Speaker)
Pitfalls of risk analysis: Managing the analysis process, risk perception,
communication and implementation
Final Presentation
(Final reports are due 5/6/2005)
Reading
Reading
K&H 10