That’s tricky as people have a shocking propensity to build in flood plains either way and dams only mitigate flooding rather than prevent it. I personally doubt that many people are going to change their mind because the location they want to build their home likely floods every 90 years vs every 30.
Bill a friend of mine built a large addition on a house which had flooded twice while he had been living there, once actually reaching the second story. In his mind it’s picture perfect 99.9% of the time so what’s an inconvenience every few decades. In the end he died before the next flood, but now there is a nice house in a flood plain.
I think the economic decision making eventually trickles down from banks and insurance companies who actually do the math themselves and charge building-owners/mortgage-owners competitively. It's sort of an continuous invisible hand.
Bill a friend of mine built a large addition on a house which had flooded twice while he had been living there, once actually reaching the second story. In his mind it’s picture perfect 99.9% of the time so what’s an inconvenience every few decades. In the end he died before the next flood, but now there is a nice house in a flood plain.
This isn’t reserved to individuals, companies didn’t abandon large areas of NYC after the last flood. https://www1.nyc.gov/site/planning/data-maps/flood-hazard-ma...