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Natural Disaster Impacts and Fiscal Decentralization

  • Hideki Toya
  • Mark Skidmore

In recent years, many developing countries have sought to implement more decentralized governmental systems. Despite efforts toward fiscal federalism, assessment of decentralization activity has been hampered by lack of consistent cross-country measures of effectiveness. Since governments play a central role in the management of catastrophic events, disaster impact data provide an opportunity to evaluate whether government structure is important in limiting disaster losses. We use cross-country data over the 1970–2005 period to estimate the relationship between decentralization and disaster casualties; countries with more decentralized governments experience fewer disaster-induced fatalities.

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Article provided by Ifo Institute for Economic Research at the University of Munich in its journal CESifo Forum.

Volume (Year): 11 (2010)
Issue (Month): 2 (07)
Pages: 43-55

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Handle: RePEc:ces:ifofor:v:11:y:2010:i:2:p:43-55
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  1. Mark Skidmore & Hideki Toya, 2005. "Economic Development and the Impacts of Natural Disasters," Working Papers 05-04, UW-Whitewater, Department of Economics.
  2. World Bank, 2003. "World Development Indicators 2003," World Bank Publications, The World Bank, number 13920.
  3. Arzaghi, Mohammad & Henderson, J. Vernon, 2005. "Why countries are fiscally decentralizing," Journal of Public Economics, Elsevier, vol. 89(7), pages 1157-1189, July.
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  8. Kellenberg, Derek K. & Mobarak, Ahmed Mushfiq, 2008. "Does rising income increase or decrease damage risk from natural disasters?," Journal of Urban Economics, Elsevier, vol. 63(3), pages 788-802, May.
  9. Davoodi, Hamid & Zou, Heng-fu, 1998. "Fiscal Decentralization and Economic Growth: A Cross-Country Study," Journal of Urban Economics, Elsevier, vol. 43(2), pages 244-257, March.
  10. Alderman, H., 1998. "Social Assistance in Albania. Decentralization and Targeted Transfers," Papers 134, World Bank - Living Standards Measurement.
  11. Jan K. Brueckner, 2005. "Fiscal Federalism and Economic Growth," Working Papers 050612, University of California-Irvine, Department of Economics.
  12. Thornton, John, 2007. "Fiscal decentralization and economic growth reconsidered," Journal of Urban Economics, Elsevier, vol. 61(1), pages 64-70, January.
  13. Akai, Nobuo & Sakata, Masayo, 2002. "Fiscal decentralization contributes to economic growth: evidence from state-level cross-section data for the United States," Journal of Urban Economics, Elsevier, vol. 52(1), pages 93-108, July.
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