IDEAS home Printed from https://ideas.repec.org/p/eti/dpaper/13051.html

The Impacts of Natural Disasters on Plants' Growth: Evidence from the Great Hanshin-Awaji (Kobe) Earthquake

Author

Listed:
  • Ayumu TANAKA

Abstract

The Great Hanshin-Awaji (Kobe) Earthquake in 1995 affected numerous plants in Kobe. In this study, I focus on this earthquake and use plant-level data to re-examine the creative disaster hypothesis which states that natural disasters enhance the growth of firms or plants in the affected areas. I employ the matching method and the difference-in-difference (DID) approach to reveal the effects of the quake. The results show that the plants that survived in the most devastated districts of Kobe faced severe negative effects in terms of employment growth and value added in the subsequent three years. This result is not consistent with previous empirical studies that support the creative disaster hypothesis.

Suggested Citation

  • Ayumu TANAKA, 2013. "The Impacts of Natural Disasters on Plants' Growth: Evidence from the Great Hanshin-Awaji (Kobe) Earthquake," Discussion papers 13051, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:13051
    as

    Download full text from publisher

    File URL: https://www.rieti.go.jp/jp/publications/dp/13e051.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Yang Dean, 2008. "Coping with Disaster: The Impact of Hurricanes on International Financial Flows, 1970-2002," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-45, June.
    2. Henriet, Fanny & Hallegatte, Stéphane & Tabourier, Lionel, 2012. "Firm-network characteristics and economic robustness to natural disasters," Journal of Economic Dynamics and Control, Elsevier, vol. 36(1), pages 150-167.
    3. Paolo Angelini & Andrea Generale, 2008. "On the Evolution of Firm Size Distributions," American Economic Review, American Economic Association, vol. 98(1), pages 426-438, March.
    4. Horwich, George, 2000. "Economic Lessons of the Kobe Earthquake," Economic Development and Cultural Change, University of Chicago Press, vol. 48(3), pages 521-542, April.
    5. Noy, Ilan, 2009. "The macroeconomic consequences of disasters," Journal of Development Economics, Elsevier, vol. 88(2), pages 221-231, March.
    6. Adam Rose & Shu‐Yi Liao, 2005. "Modeling Regional Economic Resilience to Disasters: A Computable General Equilibrium Analysis of Water Service Disruptions," Journal of Regional Science, Wiley Blackwell, vol. 45(1), pages 75-112, February.
    7. Toya, Hideki & Skidmore, Mark, 2007. "Economic development and the impacts of natural disasters," Economics Letters, Elsevier, vol. 94(1), pages 20-25, January.
    8. Yasuyuki Sawada & Satoshi Shimizutani, 2007. "Consumption insurance against natural disasters: evidence from the Great Hanshin-Awaji (Kobe) earthquake," Applied Economics Letters, Taylor & Francis Journals, vol. 14(4), pages 303-306.
    9. 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.
    10. Strobl, Eric, 2012. "The economic growth impact of natural disasters in developing countries: Evidence from hurricane strikes in the Central American and Caribbean regions," Journal of Development Economics, Elsevier, vol. 97(1), pages 130-141.
    11. Andrea Leiter & Harald Oberhofer & Paul Raschky, 2009. "Creative Disasters? Flooding Effects on Capital, Labour and Productivity Within European Firms," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(3), pages 333-350, July.
    12. Yasuyuki Sawada & Satoshi Shimizutani, 2008. "How Do People Cope with Natural Disasters? Evidence from the Great Hanshin‐Awaji (Kobe) Earthquake in 1995," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 40(2‐3), pages 463-488, March.
    13. Iichiro UESUGI & Hirofumi UCHIDA & Taisuke UCHINO & Arito ONO & Makoto HAZAMA & Kaoru HOSONO & Daisuke MIYAKAWA, 2012. "Natural Disasters and Firm Dynamics (Japanese)," Policy Discussion Papers (Japanese) 12001, Research Institute of Economy, Trade and Industry (RIETI).
    14. Jesús Crespo Cuaresma & Jaroslava Hlouskova & Michael Obersteiner, 2008. "Natural Disasters As Creative Destruction? Evidence From Developing Countries," Economic Inquiry, Western Economic Association International, vol. 46(2), pages 214-226, April.
    15. William D. Nordhaus, 2006. "The Economics of Hurricanes in the United States," NBER Working Papers 12813, National Bureau of Economic Research, Inc.
    16. Matthew E. Kahn, 2005. "The Death Toll from Natural Disasters: The Role of Income, Geography, and Institutions," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 271-284, May.
    17. Ariel R. Belasen & Solomon W. Polachek, 2009. "How Disasters Affect Local Labor Markets: The Effects of Hurricanes in Florida," Journal of Human Resources, University of Wisconsin Press, vol. 44(1).
    18. Siodla, James, 2015. "Razing San Francisco: The 1906 disaster as a natural experiment in urban redevelopment," Journal of Urban Economics, Elsevier, vol. 89(C), pages 48-61.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Matteo Coronese & Davide Luzzati, 2022. "Economic impacts of natural hazards and complexity science: a critical review," LEM Papers Series 2022/13, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    2. Ryuhei Wakasugi & Ayumu Tanaka, 2013. "Recovery from the Mega-quake in Japan: Evidence from Manufacturing Firms," KIER Working Papers 867, Kyoto University, Institute of Economic Research.
    3. Gignoux, Jérémie & Menéndez, Marta, 2016. "Benefit in the wake of disaster: Long-run effects of earthquakes on welfare in rural Indonesia," Journal of Development Economics, Elsevier, vol. 118(C), pages 26-44.
    4. Eduardo Cavallo & Ilan Noy, 2009. "The Economics of Natural Disasters: A Survey," Research Department Publications 4649, Inter-American Development Bank, Research Department.
    5. Rahman, Muhammad Habibur, 2018. "Earthquakes don’t kill, built environment does: Evidence from cross-country data," Economic Modelling, Elsevier, vol. 70(C), pages 458-468.
    6. Yamamura, Eiji, 2013. "Impact of natural disasters on income inequality: Analysis using panel data during the period 1965 to 2004," MPRA Paper 45623, University Library of Munich, Germany.
    7. Matthew A. COLE & Robert J R ELLIOTT & Toshihiro OKUBO & Eric STROBL, 2013. "Natural Disasters and Plant Survival: The impact of the Kobe earthquake," Discussion papers 13063, Research Institute of Economy, Trade and Industry (RIETI).
    8. Naqvi, Asjad, 2017. "Deep Impact: Geo-Simulations as a Policy Toolkit for Natural Disasters," World Development, Elsevier, vol. 99(C), pages 395-418.
    9. Yamamura, Eiji, 2012. "Natural disasters and their long-term effect on happiness: the case of the great Hanshin-Awaji earthquake," MPRA Paper 37505, University Library of Munich, Germany.
    10. Matthew A. COLE & Robert J R ELLIOTT & Toshihiro OKUBO & Eric STROBL, 2015. "Natural Disasters, Industrial Clusters and Manufacturing Plant Survival," Discussion papers 15008, Research Institute of Economy, Trade and Industry (RIETI).
    11. Susana Ferreira, 2024. "Extreme Weather Events and Climate Change: Economic Impacts and Adaptation Policies," Annual Review of Resource Economics, Annual Reviews, vol. 16(1), pages 207-231, October.
    12. Sawada, Yasuyuki & Takasaki, Yoshito, 2017. "Natural Disaster, Poverty, and Development: An Introduction," World Development, Elsevier, vol. 94(C), pages 2-15.
    13. Suman K SHARMA, 2010. "Socio-Economic Aspects of Disaster’s Impact: An Assessment of Databases and Methodologies," Economic Growth Centre Working Paper Series 1001, Nanyang Technological University, School of Social Sciences, Economic Growth Centre.
    14. Matthew A. Cole & Robert J R Elliott & Toshihiro Okubo & Eric Strobl, 2014. "Natural Disasters and the Birth, Life and Death of Plants: The Case of the Kobe Earthquake," Working Papers 2014-114, Department of Research, Ipag Business School.
    15. Kevin Luo & Tomoko Kinugasa, 2018. "Do natural disasters influence long-term saving?: Assessing the impact of the 2008 Sichuan earthquake on household saving rates using synthetic control," Discussion Papers 1804, Graduate School of Economics, Kobe University.
    16. Yamamura, Eiji, 2012. "Death tolls from natural disasters: Influence of interactions between fiscal decentralization, institution, and economic development," MPRA Paper 36987, University Library of Munich, Germany.
    17. Huang, Lulu & Liu, Qiannan & Tang, Yugang, 2024. "Long-term economic impact of disasters: Evidence from multiple earthquakes in China," World Development, Elsevier, vol. 174(C).
    18. Felbermayr, Gabriel & Gröschl, Jasmin, 2013. "Natural disasters and the effect of trade on income: A new panel IV approach," European Economic Review, Elsevier, vol. 58(C), pages 18-30.
    19. Sweta Sen & Narayan Chandra Nayak & William Kumar Mohanty, 2023. "Impact of tropical cyclones on sustainable development through loops and cycles: evidence from select developing countries of Asia," Empirical Economics, Springer, vol. 65(5), pages 2467-2498, November.
    20. Heger, Martin Philipp & Neumayer, Eric, 2019. "The impact of the Indian Ocean tsunami on Aceh’s long-term economic growth," Journal of Development Economics, Elsevier, vol. 141(C).

    More about this item

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eti:dpaper:13051. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: TANIMOTO, Toko (email available below). General contact details of provider: https://edirc.repec.org/data/rietijp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.