How is the economic cost of a fire calculated?

When a fire devastates a region, the first figures that appear are the hectares burned, the destroyed homes, and the agricultural losses. These are incomplete data. It is necessary to distinguish between direct, indirect, induced (or long-term), and intangible costs. The analysis does not incorporate the human cost of the injured or lost lives. It focuses on the economic impact.The direct costs are the most evident: lost timber, destroyed crops, dead livestock, damaged homes, affected roads or power lines and, of course, the cost of extinguishing the fire: about 10,000 euros per hectare.The indirect effects: a fire can make a large part of a region's economic activity disappear for months. Rural tourism is one of the first affected. Reservations and visits are cancelled, and many travelers, even if the fire is already extinguished, opt for other destinations. This affects the hotel industry, small businesses, and outdoor activity companies. Their income can drop for weeks or even several seasons.Extraordinary resources allocated to restoring forests, repairing infrastructure, strengthening surveillance, and granting aid to those affected are no longer allocated to other productive investments. This is the so-called opportunity cost.Among the induced costs, also called long-term costs, are future investment losses: the entrepreneur who was thinking of opening a rural house or a business and postpones the project or moves elsewhere… A fire reduces future investment, employment, and activity. It is an economic damage that is difficult to measure because no one knows what is not happening.And, finally, intangible environmental costs, without a market price but with an enormous economic cost: the loss of biodiversity, of carbon capture, of water regulation, of protection against erosion or, simply, of the destroyed landscape value. These damages can exceed the value of material losses.The cost of the Gavarres fire, adding up all the concepts, will probably exceed 150 million euros. Destroying a forest takes a few hours; rebuilding the economic fabric around it takes a whole generation.Now I take off my economist hat. And costs appear that the economy does not capture: the sadness of seeing our Catalonia burn, the fear that invades us, the psychological impact on those affected and those not affected and, above all, the distrust towards our neighbor.Last week, the flames of a wildfire covering several hectares reached a few meters from my house. Last night, a neighbor was celebrating a gender reveal (party to announce the baby's sex) with rockets and firecrackers. Eight days earlier, part of his municipality had burned down.I wondered how long it takes to forget what a fire entails.