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The Indian Ocean Tsunami: Economic Impact, Disaster Management, and Lessons

Author

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  • Prema-chandra Athukorala

    (Division of Economics, Research School of Pacific and Asian Studies, Australian National University, Canberra, ACT 0200, Australia)

  • Budy P. Resosudarmo

    (Division of Economics, Research School of Pacific and Asian Studies, Australian National University, Canberra, ACT 0200, Australia)

Abstract

This paper documents and analyzes the immediate economic impact of the Indian Ocean tsunami generated by the Sumatra-Andaman earthquake of 26 December 2004, with a focus on Indonesia (Aceh province) and Sri Lanka, and assesses the disaster management process. The preliminary findings point to the importance of educating the public about simple precautions in the event of a disaster and enforcing coastal environmental regulations. The findings also argue for designing policies and programs, as an integral part of national development strategies, for mitigating the impact of natural disasters on the poor and highlight the need for combining international aid commitments with solutions to the limited aid-absorptive capacity in disaster-affected countries.

Suggested Citation

  • Prema-chandra Athukorala & Budy P. Resosudarmo, 2005. "The Indian Ocean Tsunami: Economic Impact, Disaster Management, and Lessons," Asian Economic Papers, MIT Press, vol. 4(1), pages 1-39, Winter.
    • Handle: RePEc:tpr:asiaec:v:4:y:2005:i:1:p:1-39
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    1. Ercio Muñoz S. & Alfredo Pistelli M., 2010. "¿Tienen los Terremotos un Impacto Inflacionario en el Corto Plazo? Evidencia para una Muestra de Países," Notas de Investigación Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 13(2), pages 113-127, April.
    2. Brown, Sarah & Harris, Mark N. & Taylor, Karl, 2012. "Modelling charitable donations to an unexpected natural disaster: Evidence from the U.S. Panel Study of Income Dynamics," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 97-110.
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    4. Czura, Kristina & Klonner, Stefan, 2023. "Financial market responses to a natural disaster: Evidence from credit networks and the Indian Ocean tsunami," Journal of Development Economics, Elsevier, vol. 160(C).
    5. David McEntire & Jill Souza & Matthew Collins & Ekong Peters & Abdul-Akeem Sadiq, 2012. "An introspective glance into damage assessment: challenges and lessons learned from the Paso Robles (San Simeon) earthquake," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 61(3), pages 1389-1409, April.
    6. Kunal Sen & Liesbet Steer, 2005. "Survey of recent developments," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 41(3), pages 279-304.
    7. Falck, Oliver & Heblich, Stephan & Link, Susanne, 2011. "The Evils of Forced Migration: Do Integration Policies Alleviate Migrants' Economic Situations?," Stirling Economics Discussion Papers 2011-14, University of Stirling, Division of Economics.
    8. Zhiguo Xu & Shanshan Liang & Mohd Nashriq Bin Abd Rahman & Hongwei Li & Jianyu Shi, 2021. "Historical earthquakes, tsunamis and real-time earthquake monitoring for tsunami advisory in the South China Sea region," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 107(1), pages 771-793, May.
    9. Lyons, Michal, 2009. "Building Back Better: The Large-Scale Impact of Small-Scale Approaches to Reconstruction," World Development, Elsevier, vol. 37(2), pages 385-398, February.
    10. Budy P. Resosudarmo & Catur Sugiyanto & Ari Kuncoro, 2012. "Livelihood Recovery after Natural Disasters and the Role of Aid: The Case of the 2006 Yogyakarta Earthquake," Asian Economic Journal, East Asian Economic Association, vol. 26(3), pages 233-259, September.
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    12. Sina, Dantje & Chang-Richards, Alice Yan & Wilkinson, Suzanne & Potangaroa, Regan, 2019. "A conceptual framework for measuring livelihood resilience: Relocation experience from Aceh, Indonesia," World Development, Elsevier, vol. 117(C), pages 253-265.
    13. Joost Santos & Christian Yip & Shital Thekdi & Sheree Pagsuyoin, 2020. "Workforce/Population, Economy, Infrastructure, Geography, Hierarchy, and Time (WEIGHT): Reflections on the Plural Dimensions of Disaster Resilience," Risk Analysis, John Wiley & Sons, vol. 40(1), pages 43-67, January.
    14. Aloysius G. Brata & Henri L. F. de Groot & Piet Rietveld, 2014. "The Impact of the Indian Ocean Tsunami and the Nias Earthquake on the Spatial Distribution of Population in Northern Sumatra," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 50(1), pages 101-121, April.
    15. Czura, Kristina & Klonner, Stefan, 2010. "The Tsunami and the Chit Fund- Evidence from the Indian Ocean Tsunami Hit on Credit Demand in South India," Proceedings of the German Development Economics Conference, Hannover 2010 46, Verein für Socialpolitik, Research Committee Development Economics.
    16. Prema-chandra Athukorala, 2012. "Disaster, Generosity and Recovery: Indian Ocean Tsunami," Departmental Working Papers 2012-04, The Australian National University, Arndt-Corden Department of Economics.
    17. Melissa L. Finucane & Joie Acosta & Amanda Wicker & Katie Whipkey, 2020. "Short-Term Solutions to a Long-Term Challenge: Rethinking Disaster Recovery Planning to Reduce Vulnerabilities and Inequities," IJERPH, MDPI, vol. 17(2), pages 1-19, January.
    18. Latha Poonamallee & Simy Joy, 2022. "Rousing Collective Compassion at Societal Level: Lessons from Newspaper Reports on Asian Tsunami in India," IIM Kozhikode Society & Management Review, , vol. 11(1), pages 25-46, January.
    19. Esa Azali Asyahid & Immanuel Satya Pekerti, 2022. "Economic impact of natural disasters, spillovers, and role of human development: case of Indonesia," Letters in Spatial and Resource Sciences, Springer, vol. 15(3), pages 493-506, December.
    20. Vishwas Gupta, 2016. "Indian reality tourism - a critical perspective," Tourism and Hospitality Management, University of Rijeka, Faculty of Tourism and Hospitality Management, vol. 22(2), pages 111-133, December.
    21. Latha Poonamallee & Simy Joy, 2019. "Key Elements Of Compassion Rousing Communication: Lessonsfrom Media Reports On Asian Tsunami In India," Working papers 350, Indian Institute of Management Kozhikode.
    22. Kristina Czura & Stefan Klonner, 2018. "Financial Market Responses to a Natural Disaster: Evidence from Local Credit Networks and the Indian Ocean Tsunami," CESifo Working Paper Series 7354, CESifo.
    23. Aurélia Lépine & Maria Restuccio & Eric Strobl, 2021. "Can we mitigate the effect of natural disasters on child health? Evidence from the Indian Ocean tsunami in Indonesia," Health Economics, John Wiley & Sons, Ltd., vol. 30(2), pages 432-452, February.
    24. Becchetti, Leonardo & Castriota, Stefano, 2011. "Does Microfinance Work as a Recovery Tool After Disasters? Evidence from the 2004 Tsunami," World Development, Elsevier, vol. 39(6), pages 898-912, June.
    25. Jiyoun An & Bokyeong Park, 2019. "Natural Disasters and International Financial Accessibility in Developing Countries," Asian Economic Papers, MIT Press, vol. 18(1), pages 245-261, Winter/Sp.

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    More about this item

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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