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Short-, Medium-, and Long-Term Growth Impacts of Catastrophic and Non-catastrophic Natural Disasters

Author

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  • Hiroki Onuma

    (Research Institute of Economy, Trade and Industry)

  • Kong Joo Shin

    (Kyushu University)

  • Shunsuke Managi

    (Kyushu University)

Abstract

Using disaster data from 1960, this paper examines the effects of natural disasters on economic growth. The analysis considers disaster effects by combining the following four dimensions: 1) short-, medium-, and long-term impacts, 2) disaster severity, categorized as catastrophic (CAT) or non-catastrophic (NCAT), 3) disaster type: hydro-meteorological, geophysical, and other specific disaster types, and 4) four income groups. The results show that the impacts of a disaster event on economic growth vary depending on the time frame, severity, disaster type, and income level. Overall, CAT disasters have negative impacts regardless of the time frame, while NCAT disasters may have positive impacts depending on the disaster type. The results also indicate that economic growth in lower-middle-income countries is most sensitive to natural disasters, but developed countries also experience negative impacts from CAT disasters.

Suggested Citation

  • Hiroki Onuma & Kong Joo Shin & Shunsuke Managi, 2021. "Short-, Medium-, and Long-Term Growth Impacts of Catastrophic and Non-catastrophic Natural Disasters," Economics of Disasters and Climate Change, Springer, vol. 5(1), pages 53-70, April.
    • Handle: RePEc:spr:ediscc:v:5:y:2021:i:1:d:10.1007_s41885-020-00074-z
    DOI: 10.1007/s41885-020-00074-z
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    2. Mohammad Reza Farzanegan & Sven Fischer, 2023. "The Impact of a Large-Scale Natural Disaster on Local Economic Activity: Evidence from the 2003 Bam Earthquake in Iran," CESifo Working Paper Series 10502, CESifo.
    3. Valeria Terrones & Richard S.J. Tol, 2022. "Relevance of financial development and fiscal stability in dealing with disasters in Emerging Economies," Working Paper Series 0722, Department of Economics, University of Sussex Business School.

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    More about this item

    Keywords

    Natural disaster; Catastrophic disaster; Hydro-meteorological disaster; Geophysical disaster; Economic growth; Income level;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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