Flood Prevention by Optimal Dike Heightening

Dike height optimization is of major importance to the Netherlands since a large part of the country is below sea level and high water levels in rivers may cause floods. In this paper we propose a cost-benefit analysis to determine optimal dike heights. We improve the model proposed by Van Dantzig (1956) after a devastating flood in the Netherlands in 1953. For one important class of the dike investment cost function we show that there is periodic solution that satisfies the first order conditions, and this solution can be easily computed. For the general case we propose a Dynamic Programming approach. Numerical results suggest that the current dike height standards in the Netherlands are too low. The Dutch government has already reserved extra funds to realize these higher standards, and it is expected that the standards in the Dutch Water Act will be adapted in the near future.