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Analyzing the Relationship Between Exposure to Extreme Weather and Economic Inequality in the Philippines

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  • Bayani-Arias, Jaimmie Kim
  • Pulanca-Tan, Rosalina

Abstract

This paper looks into the relationship between typhoon exposure and inequality in per capita income and per capita expenditure of households in the Philippines by comparing the change in the Theil L and Theil T inequality indexes between 2009 and 2012 across different exposure groups. A decomposition analysis of the Theil index was also undertaken to establish the relative contributions of within-exposure group inequality and between-exposure groups inequality to total inequality. Conforming to the paper’s hypothesis, the group that has the highest exposure to typhoons was found to experience a worsening of both income and expenditure inequality while the group with the least exposure showed no change in expenditure inequality and an improvement in income equality. The result supports the importance of implementing policies that increase the resilience of local communities in the Philippines. Apart from short-term financial damages, exposure to adverse weather may also bring an added burden of worsening economic inequality.

Suggested Citation

  • Bayani-Arias, Jaimmie Kim & Pulanca-Tan, Rosalina, 2017. "Analyzing the Relationship Between Exposure to Extreme Weather and Economic Inequality in the Philippines," Journal of Economics, Management & Agricultural Development, Journal of Economics, Management & Agricultural Development (JEMAD), vol. 3(1), June.
    • Handle: RePEc:ags:pjemad:309288
    DOI: 10.22004/ag.econ.309288
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    References listed on IDEAS

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    1. Datt, Gaurav & Hoogeveen, Hans, 2003. "El Nino or El Peso? Crisis, Poverty and Income Distribution in the Philippines," World Development, Elsevier, vol. 31(7), pages 1103-1124, July.
    2. Taha Chaiechi, 2014. "The economic impact of extreme weather events through a KaleckianóPost-Keynesian lens: A case study of the State of Queensland, Australia," Economic Analysis and Policy, Elsevier, vol. 44(1), pages 95-106.
    3. Rözer, Jesper Jelle & Volker, Beate, 2016. "Does income inequality have lasting effects on health and trust?," Social Science & Medicine, Elsevier, vol. 149(C), pages 37-45.
    4. Zamora, Christian Marvin B. & Dorado, Rowena A., 2015. "Rural-Urban Education Inequality in the Philippines Using Decomposition Analysis," Journal of Economics, Management & Agricultural Development, Journal of Economics, Management & Agricultural Development (JEMAD), vol. 1(1), June.
    5. Anthony Shorrocks & Guanghua Wan, 2005. "Spatial decomposition of inequality," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 59-81, January.
    6. repec:wsr:wpaper:y:2010:i:062 is not listed on IDEAS
    7. Günther, Isabel & Harttgen, Kenneth, 2009. "Estimating Households Vulnerability to Idiosyncratic and Covariate Shocks: A Novel Method Applied in Madagascar," World Development, Elsevier, vol. 37(7), pages 1222-1234, July.
    8. Thiede, Brian C., 2014. "Rainfall Shocks and Within-Community Wealth Inequality: Evidence from Rural Ethiopia," World Development, Elsevier, vol. 64(C), pages 181-193.
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    Cited by:

    1. Connie Bayudan-Dacuycuy & Lora Kryz Baje, 2019. "When It Rains, It Pours? Analyzing the Rainfall Shocks-Poverty Nexus in the Philippines," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 145(1), pages 67-93, August.

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