The risk coping culture of a community plays a major role in the development of urban floodplains. In this paper we analyse, in a conceptual way, the interplay of community risk coping culture, flooding damage and economic growth. We particularly focus on three aspects: (i) collective memory, i.e., the capacity of the community to keep risk awareness high; (ii) risk-taking attitude, i.e., the amount of risk the community is collectively willing to be exposed to; and (iii) trust of the community in risk reduction measures. To this end, we use a dynamic model that represents the feedback between the hydrological and social system components. Model results indicate that, on the one hand, by under perceiving the risk of flooding (because of short collective memory and too much trust in flood protection structures) in combination with a high risk-taking attitude, community development is severely limited because of high damages caused by flooding. On the other hand, overestimation of risk (long memory and lack of trust in flood protection structures) leads to lost economic opportunities and recession. There are many scenarios of favourable development resulting from a trade-off between collective memory and trust in risk reduction measures combined with a low to moderate risk-taking attitude. Interestingly, the model gives rise to situations in which the development of the community in the floodplain is path dependent, i.e., the history of flooding may lead to community growth or recession.