Economic Policies and the Impact of Natural Disasters on Economic Growth: A Threshold Regression Approach
This paper investigates the impact of natural disasters on the long-term macroeconomic performance of a country. More specifically, we want to see whether the impact of natural disasters on economic growth is uniform across countries or it is differentiated according to the macroeconomic policy environment and other structural characteristics of the countries at hand. In order to test this empirically we use the Threshold Regression (TR) approach of Hansen (2000) and data from 90 countries over the period of 1970 to 2001. Our analysis reveals several interesting patterns such as: countries with higher per capita income, higher government spending, higher degree of openness to trade, less fiscal imbalances and greater financial stability are better able to withstand the disaster shock and further prevent its impact on long-term economic growth.
Volume (Year): 32 (2012)
Issue (Month): 1 ()
|Contact details of provider:|| |
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hansen, Bruce E., 1999.
"Threshold effects in non-dynamic panels: Estimation, testing, and inference,"
Journal of Econometrics,
Elsevier, vol. 93(2), pages 345-368, December.
- Bruce E. Hansen, 1997. "Threshold effects in non-dynamic panels: Estimation, testing and inference," Boston College Working Papers in Economics 365, Boston College Department of Economics.
- Noy, Ilan, 2009. "The macroeconomic consequences of disasters," Journal of Development Economics, Elsevier, vol. 88(2), pages 221-231, March.
- Ilan Noy, 2007. "The Macroeconomic Consequences of Disasters," Working Papers 200707, University of Hawaii at Manoa, Department of Economics.
- 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.
- Raddatz, Claudio, 2007. "Are external shocks responsible for the instability of output in low-income countries?," Journal of Development Economics, Elsevier, vol. 84(1), pages 155-187, September.
- Raddatz, Claudio, 2005. "Are external shocks responsible for the instability of output in low income countries?," Policy Research Working Paper Series 3680, The World Bank.
- Crespo Cuaresma & Hlouskova & Obersteiner, 2008. "Natural Disasters As Creative Destruction? Evidence From Developing Countries," Economic Inquiry, Western Economic Association International, vol. 46(2), pages 214-226, April.
- Raddatz, Claudio, 2009. "The wrath of God : macroeconomic costs of natural disasters," Policy Research Working Paper Series 5039, The World Bank.
- Eduardo Rodriguez-Oreggia & Alejandro De La Fuente & Rodolfo De La Torre & Hector A. Moreno, 2013. "Natural Disasters, Human Development and Poverty at the Municipal Level in Mexico," Journal of Development Studies, Taylor & Francis Journals, vol. 49(3), pages 442-455, March.
- Christian R. Jaramillo H., 2009. "Do Natural Disasters Have Long-term Effects on Growth?," DOCUMENTOS CEDE 006647, UNIVERSIDAD DE LOS ANDES-CEDE.
- Albala-Bertrand, J. M., 1993. "Political Economy of Large Natural Disasters: With Special Reference to Developing Countries," OUP Catalogue, Oxford University Press, number 9780198287650.
- Loayza, Norman V. & Olaberría, Eduardo & Rigolini, Jamele & Christiaensen, Luc, 2012. "Natural Disasters and Growth: Going Beyond the Averages," World Development, Elsevier, vol. 40(7), pages 1317-1336.
- Loayza, Norman & Olaberria, Eduardo & Rigolini, Jamele & Christiaensen, Luc, 2009. "Natural disasters and growth - going beyond the averages," Policy Research Working Paper Series 4980, The World Bank.