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Impact Assessment of Natural Disasters upon Economic Growth in Pakistan

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  • Umair Shahzad

Abstract

The research is based on the natural disasters in Pakistan, and their overall impact on the economy of Pakistan. Disasters are hypothesized to have a significant effect on the GDP of Pakistan. Moreover, Pakistan is considered as a disaster prone nation due to its geographical location. Pakistan has always been likely to be affected because of floods due to monsoon rains. But looking at the recent history, Pakistan has experienced massive loss due to 2010 floods and due to the earthquake in 2005, these two being considered as the biggest disasters in Pakistan of all time. The Time-series Distributive Lag (DL) model has been used to find the model estimates. Number of people killed in disasters is taken as a proxy for disasters and it effect on economy is seen. Interaction of glacier meltdown with consumption of ozone depleting substances has been developed and is seen as a proxy cause for global warming, which ultimately results in climate change and is likely to cause natural disasters. The results suggest that natural disasters and global warming have a negative impact on the economic growth. Moreover the study focuses on the policy implications from National Disaster Management Authority (NDMA) and to avoid huge losses with better mitigation plans has been incorporated and suggestions in conclusion that how can the losses from disasters be minimized. A distributed-lag model has been used for the time-series data in this study. A DL model helps to regress the dependent variable of the current time period, in accordance to the value of previous years; lags of its independent variables. Lags are considered as a substantial part of the time-series approach. The variables are lagged accordingly to check the impact and significance on the dependent variable. As one or more explanatory variables are lagged, the model becomes multivariate distributed lag model. The lag number taken to keep the variables is two; hence they are lagged for two time periods Where as in case of aid its different. All the variables used are quantified properly and for the collection of data, authentic databases have been consulted and relied upon.Natural Disasters are expected to have a Significant impact on slowing down the economic development of Pakistan.

Suggested Citation

  • Umair Shahzad, 2014. "Impact Assessment of Natural Disasters upon Economic Growth in Pakistan," 2nd International Conference on Energy, Regional Integration and Socio-Economic Development 7373, EcoMod.
    • Handle: RePEc:ekd:006666:7373
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    Cited by:

    1. Ameer Hyder & Nasir Iqbal, 2016. "Socio-Economic Losses of Flood and Household’s Coping Strategies: Evidence from Flood Prone District of Pakistan," PIDE-Working Papers 2016:142, Pakistan Institute of Development Economics.
    2. Usama Anwar & Abdul Rehman Nawaz & Hafiz Ghulam Mujaddad, 2021. "COVID-19 in Pakistan: How to Spark the Economic Recovery-Analysis from Previous Natural Disasters," Journal of Economic Impact, Science Impact Publishers, vol. 3(3), pages 209-220.

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    Keywords

    Pakistan; Socio-economic development; Other issues;
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