Cost-Benefit Analysis of Full-Body Scanners

Research paper from Mark Stewart and John Mueller:
The Transportation Security Administration (TSA) has been deploying Advanced Imaging Technologies (AIT) that are full-body scanners to inspect a passenger’s body for concealed weapons, explosives, and other prohibited items. The terrorist threat that AITs are primarily dedicated to is preventing the downing of a commercial airliner by an IED (Improvised Explosive Device) smuggled on board by a passenger. The cost of this technology will reach $1.2 billion per year by 2014. The paper develops a cost-benefit analysis of AITs for passenger screening at U.S. airports. The analysis considered threat probability, risk reduction, losses, and costs of security measures in the estimation of costs and benefits. Since there is uncertainty and variability of these parameters, three alternate probability (uncertainty) models were used to characterise risk reduction and losses. Economic losses were assumed to vary from $2-50 billion, and risk reduction from 5-10%. Monte-Carlo simulation methods were used to propagate these uncertainties in the calculation of benefits, and the minimum attack probability necessary for AITs to be cost-effective was calculated. It was found that, based on mean results, more than one attack every two years would need to originate from U.S. airports for AITs to pass a cost-benefit analysis. In other words, to be cost-effective, AITs every two years would have to disrupt more than one attack effort with body-borne explosives that otherwise would have been successful despite other security measures, terrorist incompetence and amateurishness, and the technical difficulties in setting off a bomb sufficiently destructive to down an airliner. The attack probability needs to exceed 160-330% per year to be 90% certain that AITs are cost-effective.

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