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Natural disasters and regional development – the case of earthquakes

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  • Fabian, Marius
  • Lessmann, Christian
  • Sofke, Tim

Abstract

We analyze the impact of earthquakes on nighttime lights at a sub-national level, i.e., on grids of different size. We argue that existing studies on the impact of natural disasters on economic development have several important limitations, both at the level of the outcome variable as well as at the level of the independent variable, e.g., the timing of an event and the measuring of its intensity. We aim to overcome these limitations by using geophysical event data on earthquakes together with satellite nighttime lights. Using panel fixed effects regressions covering the entire world for the period 1992–2013, we find that earthquakes reduce both light growth rates and light levels significantly. The effects persist for approximately 5 years, but we find no long-run effects. Effects are stronger the smaller the area of a unit of observation. National institutions and economic conditions are relevant moderating factors.

Suggested Citation

  • Fabian, Marius & Lessmann, Christian & Sofke, Tim, 2019. "Natural disasters and regional development – the case of earthquakes," Environment and Development Economics, Cambridge University Press, vol. 24(5), pages 479-505, October.
    • Handle: RePEc:cup:endeec:v:24:y:2019:i:05:p:479-505_00
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    Cited by:

    1. Richard S. J. Tol, 2022. "State capacity and vulnerability to natural disasters," Chapters, in: Mark Skidmore (ed.), Handbook on the Economics of Disasters, chapter 20, pages 434-457, Edward Elgar Publishing.
    2. Katarzyna A. Bilicka & André Seidel, 2022. "Measuring Firm Activity from Outer Space," NBER Working Papers 29945, National Bureau of Economic Research, Inc.
    3. Dodlova, Marina & Carias, Michelle Escobar & Grimm, Michael, 2023. "The Effects of the 2010 Haiti Earthquake on Children's Nutrition and Education," IZA Discussion Papers 16195, Institute of Labor Economics (IZA).
    4. Ilari Määttä & Thomas Ferreira & Christian Leßmann, 2022. "Nighttime lights and wealth in very small areas: [Nachtlichter und Wohlstand in Kleinräumigen Daten:]," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 42(2), pages 161-190, August.

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