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The Opportunity of a Disaster: The Economic Impact of the 1755 Lisbon Earthquake

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  • ALVARO S. PEREIRA
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    Abstract

    By combining new archival and existing data, this paper provides estimates of the economic impact of the 1755 Lisbon earthquake, the largest ever-recorded natural catastrophe in Europe. The direct cost of the earthquake is estimated to be between 32 and 48 percent of the Portuguese GDP. In spite of strict controls, prices and wages remained volatile in the years after the tragedy. The recovery from earthquake also led to a rise in the wage premium of construction workers. More significantly, the earthquake became an opportunity for economic reform and to reduce the economic semi-dependency vis-à-vis Britain.

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    Bibliographic Info

    Paper provided by CHERRY, c/o Department of Economics, University of York in its series Centre for Historical Economics and Related Research at York (CHERRY) Discussion Papers with number 06/03.

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    Date of creation: Dec 2006
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    Handle: RePEc:yor:cherry:06/03

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    Keywords: Lisbon 1755 earthquake; natural disasters; economic development;

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    1. Mark Skidmore & Hideki Toya, 2002. "Do Natural Disasters Promote Long-Run Growth?," Economic Inquiry, Western Economic Association International, vol. 40(4), pages 664-687, October.
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