More suffering, more involvement? The causal effects of seismic disasters on social capital

Between 2004 and 2007, a series of earthquakes struck Indonesia, resulting in devastating damages. We investigate the changes that occurred in social capital after the experience of these events. Employing a panel of nationally representative surveys measuring several dimensions of social capital as well as a differences-in-differences (DID) strategy, we find that compared to individuals living in the non-affected communities, respondents who experienced any of the earthquakes became more likely to participate in community meetings, volunteer activities, the voting process, and microfinance/microcredit programs. The accumulated scale of the earthquakes experienced by an individual between 2004 and 2007 shows an inverse U-shaped relationship with enhanced social interactions among residents. Furthermore, the results remain robust to numerous alternative hypotheses and specifications. The main pathway through which this effect takes place is the higher demand for informal health-relevant information brought upon by the worsened health condition of the affected individuals and the insufficient supply of formal health care in the regions affected by the catastrophes.