Risk Analysis in Engineering and Economics

Risk Analysis in Engineering and Economics is required reading for decision-making under conditions of uncertainty. Drawing on his extensive experience in uncertainty, risk modeling, and analysis, the author covers everything from basic theory and key computational algorithms to data needs, sources, and collection. He emphasizes real-world solutions and the practical use of the methods while carefully examining the advantages and limitations of each to help readers translate the discussed techniques into practice. The third edition continues and advances the successful approach of this text. It offers: - The fundamental concepts, techniques, and applications of the subject in a style tailored to meet the needs of students and practitioners of engineering, science, economics, and finance - Introduces the fundamentals to facilitate quantification and rational decision-making - Enhances the coverage of economic valuation, risk tolerance, and attitude - Emphasizes the practical use of these methods through real-world case studies - Establishes the limitations, advantages, and disadvantages of various methods - Targets analysts, researchers, and/or anyone who deals with risk analysis to solve problems The book is designed to emphasize the applications of the concepts presented. The fundamental concepts are properly balanced in eight well-organized chapters. The outstanding features of the third edition include: - More material on risk management and finance, including enhancements of the coverage of economic valuation, risk tolerance, and risk attitudes in decision-making - A renewed emphasis on practical problem solving - More diversity in examples from engineering, the sciences, insurance, and so forth - Maintains illustrative, complex examples with explicitly presented computations to enable students to reproduce the computations - Enhanced exercises to increase the difficulty of some of them Other books by the author include Numerical Analysis for Engineers, third edition, with Richard H. McCuen, © 2026, and Probability, Statistics, and Reliability for Engineers and Scientists, fourth edition, with Richard H. McCuen, © 2025, both published by CRC Press.

Bilal M. Ayyub is a professor of civil and environmental engineering and the director of the Center for Technology and Systems Management in the A. James Clark School of Engineering at the University of Maryland, where he has been since 1983. He is a leading authority in risk analysis, uncertainty modeling, decision analysis, and systems engineering. Dr. Ayyub earned degrees from Kuwait University and the Georgia Institute of Technology. He is a fellow of the ASCE, the ASME, and the SNAME, and a senior member of the IEEE. Dr. Ayyub has served on many national committees and investigation boards and completed numerous research and development projects for governmental and private entities, including the National Science Foundation; the U.S. Air Force, Coast Guard, Army Corps of Engineers, Navy, and Department of Homeland Security; and insurance and engineering firms. He has received multiple ASNE Jimmie Hamilton Awards for best papers in the Naval Engineers Journal, the ASCE Outstanding Research-Oriented Paper in the Journal of Water Resources Planning and Management, the ASCE Edmund Friedman Award, the ASCE Walter Huber Research Prize, the K.S. Fu Award of NAFIPS, and the Department of the Army Public Service Award. Dr. Ayyub is the author/co-author of more than 550 publications in journals, conference proceedings, and reports, as well as 20 books, including Uncertainty Modeling and Analysis for Engineers and Scientists; Risk Analysis in Engineering and Economics; Elicitation of Expert Opinions for Uncertainty and Risks; Probability, Statistics and Reliability for Engineers and Scientists, Second Edition; and Numerical Methods for Engineers. Richard H. McCuen is the Ben Dyer Professor of civil and environmental engineering at the University of Maryland. Dr. McCuen earned degrees from Carnegie Mellon University and the Georgia Institute of Technology. His primary research interests are statistical hydrology and stormwater management. He has received the Icko Iben Award from the American Water Resource Association and was co-recipient of the Outstanding Research Award from the ASCE Water Resources, Planning and Management Division. He is the author/co-author of over 250 professional papers and 21 books, including Fundamentals of Civil Engineering: An Introduction to the ASCE Body of Knowledge; Modeling Hydrologic Change; Hydrologic Analysis and Design, Third Edition; The Elements of Academic Research; Estimating Debris Volumes for Flood Control; and Dynamic Communication for Engineers.

1. Introduction 2. Risk Terminology and Events 3. Fundamental Risk Methods 4. System Definition and Structure 5. Component Failure Probability Assessment 6. System Failure Probability Assessment 7. Failure Consequences and Valuations 8. Engineering Economics and Finance 9. Risk Treatment and Control Methods 10. Data for Risk Studies 11. Risk-Based Maintenance of Marine Vessels: A Case Study