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Drawing first on transaction cost economic theory, we suggest that whether and how an organization decides to invest in hazard mitigation depends partly on whether the organization believes that such investments will yield a profitable return. Then, consistent with institutional theory, we argue that there are external and internal forces that influence how and whether organizations choose to mitigate against extreme events.
Using regulatory theory, we suggest that several characteristics of the regulatory relationship will influence hazard mitigation investment decision making, including the degree or intensity of the regulation, competence of the regulators, and collaboration in developing regulations...
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