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Do tropical typhoons smash community ties? Theory and evidence from Vietnam

Author

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  • Yanos Zylberberg

    (PSE - Paris-Jourdan Sciences Economiques - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - EHESS - École des hautes études en sciences sociales - INRA - Institut National de la Recherche Agronomique - ENS Paris - École normale supérieure - Paris, PSE - Paris School of Economics)

Abstract

Natural disasters trigger large inequalities between affected households and the rest of the community. The extent to which villages compensate for these shocks allegedly depends on the pressure imposed by the group of needy families. I model two major threats to redistribution - (i) the emergence of acoalition of winners willing to shy away from redistributing to their peers and (ii) the initial fractionalization of the community. Matching data on a wave of tropical typhoons with a panel household survey in Vietnam, I find less redistribution in villages where needy families are in the minority. Whereas 17 cents on average are covered through informal transfers for a relative income loss of $1, access to liquidity falls below 10 cents when heavily affected households are isolated in the commune. In line with the existing literature, minorities participate less in the resources reallocation. Despite these barriers to full insurance, risk-sharing through informal transfers is still economically significant. This result is related with the findings that communities having suffered important trauma show greater signs of resilience and cohesiveness.

Suggested Citation

  • Yanos Zylberberg, 2010. "Do tropical typhoons smash community ties? Theory and evidence from Vietnam," PSE Working Papers halshs-00564941, HAL.
  • Handle: RePEc:hal:psewpa:halshs-00564941
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00564941
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Chi Huu Nguyen & Christophe J. Nordman, 2018. "Household Entrepreneurship and Social Networks: Panel Data Evidence from Vietnam," Journal of Development Studies, Taylor & Francis Journals, vol. 54(4), pages 594-618, April.
    2. Tiago Freire & J. Vernon Henderson & Ari Kuncoro, 2017. "Volunteerism after the Tsunami: The Effects of Democratization," World Bank Economic Review, World Bank Group, vol. 31(1), pages 176-195.
    3. Eva Deuchert & Christina Felfe, 2013. "The Tempest: Natural Disasters, Early Shocks and Children's Short- and Long-Run Development," CESifo Working Paper Series 4168, CESifo Group Munich.
    4. Ginger Turner & Farah Said & Uzma Afzal, 2014. "Microinsurance Demand After a Rare Flood Event: Evidence From a Field Experiment in Pakistan," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 39(2), pages 201-223, April.

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    Keywords

    natural disasters; informal risk-sharing; social insurance; altruism;

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