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The impact of the Indian Ocean tsunami on Aceh’s long-term economic growth

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  • Heger, Martin Philipp
  • Neumayer, Eric

Abstract

Existing studies typically find that natural disasters have negative economic consequences, resulting in, at best, a recovery to trend after initial losses or, at worst, longer term sustained losses. We exploit the unexpected nature of the 2004 Indian Ocean tsunami for carrying out a quasi-experimental difference-in-differences analysis of flooded districts and sub-districts in Aceh. The Indonesian province saw the single largest aid and reconstruction effort of any developing world region ever afflicted by a natural disaster. We show that this effort triggered higher long-term economic output than would have happened in the absence of the tsunami.

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  • Heger, Martin Philipp & Neumayer, Eric, 2019. "The impact of the Indian Ocean tsunami on Aceh’s long-term economic growth," LSE Research Online Documents on Economics 101115, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:101115
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    Cited by:

    1. Heger, Martin Philipp & Neumayer, Eric, 2021. "Economic legacy effects of armed conflict: insights from the Civil War in Aceh, Indonesia," LSE Research Online Documents on Economics 108236, London School of Economics and Political Science, LSE Library.
    2. Fitch-Fleischmann, Benjamin & Kresch, Evan Plous, 2021. "Story of the hurricane: Government, NGOs, and the difference in disaster relief targeting," Journal of Development Economics, Elsevier, vol. 152(C).
    3. Ben Brunckhorst, 2020. "Rural Mobility and Climate Vulnerability: Evidence from the 2015 Drought in Ethiopia," CSAE Working Paper Series 2020-17, Centre for the Study of African Economies, University of Oxford.
    4. Pierre-Guillaume Méon & Robin Rampaer & David Raymaekers, 2021. "One-minute earthquake, years of patience: Evidence from Mexico on the effect of earthquake exposure on time preference," Working Papers CEB 21-015, ULB -- Universite Libre de Bruxelles.
    5. John Gibson, 2021. "Better Night Lights Data, For Longer," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(3), pages 770-791, June.

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    More about this item

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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