The scientific evaluation of a dam's economic life is necessary to determine its management strategy rationally. However, most studies have mainly focused on analyzing the current economic characteristics of reservoir dams without considering their long-term development trend. And they have failed to incorporate the potential loss caused by dam breaches as one of the operating costs for dams. Consequently, this results in the inability to scientifically calculate the economic life of reservoir dam operations. Therefore, this study analyzed the factors influencing the economic life of reservoir dams in term of safety, costs, benefits and society, and established an economic life evaluation indicator system for reservoir dams. Based on the analyses of costs and benefits of reservoir dams, an economic life evaluation model for reservoir dams was constructed by comprehensively considering the impact of potential dam breaches and the social impact of reservoir dams on the production and lives of local residents. Moreover, based on economic theory, the economics of various types of management measures for reservoir dams and their impact on the economic life of dams were analyzed. The proposed model was applied to the Luhun Reservoir in Henan Province, China, to quantify the comprehensive costs and benefits of its operation for each year after 1990 s, analyze the trend of its “cost-benefit” relationship, and calculate its expected economic life. The results showed that when considering its own risks and social impacts, the expected economic life of the Luhun Reservoir was 74 years. The Luhun Reservoir is expected to operate up to its non-economic life span till 2039. Finally, suggestions for expanding the economic life of dams were proposed. Potential dam breach losses can significantly reduce the economic life of reservoir dams. And risk management measures for reservoir dams should be particularly strengthened during daily operations and management.