Measuring Weather Risk: The Case of Winter Tourism in Austria

Weather affects many economic sectors, in particular sectors like agriculture, energy, construction and tourism. While this is well known to those facing losses, it is generally difficult to measure this weather risk at appropriate temporal and spatial scales and make it comparable. In this book a unique framework for assessing non-catastrophic weather risk is presented and applied to the example of the winter tourism industry in Austria. Weather risk is expressed as Value at Risk(weather), in short VaR(weather), which corresponds to the maximum loss from adverese weather conditions that is not exceeded with a given probability level over a given period of time, for example a 1 in 20 year event.