In Mint, Narayan Ramachandran has a nice op-ed on the issue of dam capacity and damn management in the wake of the floods in Kerala last year. In that, he writes:
For dams to do their jobs in extreme situations, they should have large unfilled capacity in their reservoirs when extreme events occur
Reading this piece reminded me of Benoit Mandelbrot’s The (Mis)Behaviour of Markets, and his description of the efforts of the colonial British government in Egypt in deciding the height of the Aswan dam. The problem with the Nile was “long range dependence” – the flow in the river in a year was positively correlated with the flow in the previous few years. This meant that there would be years of high flow followed by years of low flow.
The problem was solved by a British hydrologist Harold Edwin Hurst by looking at thousands of years of data of the flooding of the Nile (yes, this data was available), and there is a nice description of it in Mandelbrot’s book.
I had taken a few insights from this chapter for my own piece on long-range dependence in stock markets that I had written for Mint a few years back.