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Foreign Aid in the Aftermath of Large Natural Disasters

Author

Listed:
  • Oscar Becerra
  • Eduardo A. Cavallo
  • Ilan Noy

Abstract

This paper examines Official Development Assistance (ODA) in the aftermath of large natural disasters between 1970 and 2008. Using an event-study approach, the paper finds that while the median increase in ODA is 18 percent compared to pre-disaster flows, the typical surge is small in relation to the size of the affected economies. Moreover, aid surges typically cover only 3 percent of the total estimated economic damages caused by the disasters. The main determinants of post-disaster aid surges are found to be the intensity of the event itself and the recipient country's characteristics such as level of development, country size and stock of foreign reserves. The paper does not find evidence that political considerations or strategic behavior on the part of donors determine the size of post-disaster aid surges.

Suggested Citation

  • Oscar Becerra & Eduardo A. Cavallo & Ilan Noy, 2012. "Foreign Aid in the Aftermath of Large Natural Disasters," IDB Publications (Working Papers) 4056, Inter-American Development Bank.
  • Handle: RePEc:idb:brikps:4056
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    References listed on IDEAS

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    1. Tijen Demirel-Pegg & James Moskowitz, 2009. "US Aid Allocation: The Nexus of Human Rights, Democracy, and Development," Journal of Peace Research, Peace Research Institute Oslo, vol. 46(2), pages 181-198, March.
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    7. Raschky, Paul A. & Schwindt, Manijeh, 2012. "On the channel and type of aid: The case of international disaster assistance," European Journal of Political Economy, Elsevier, vol. 28(1), pages 119-131.
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Cécile Couharde & Rémi Generoso, 2015. "Hydro-climatic thresholds and economic growth reversals in developing countries: an empirical investigation," EconomiX Working Papers 2015-26, University of Paris Nanterre, EconomiX.
    2. repec:eee:wdevel:v:104:y:2018:i:c:p:65-77 is not listed on IDEAS
    3. Eiji Yamamura & Yoshiro Tsutsui & Fumio Ohtake, 2017. "Altruistic and selfish motivations of charitable giving:Case of the hometown tax donation system in Japan," ISER Discussion Paper 1003, Institute of Social and Economic Research, Osaka University.
    4. De Alwis, Diana & Noy, Ilan, 2016. "Sri Lankan households a decade after the Indian Ocean tsunami," Working Paper Series 5281, Victoria University of Wellington, School of Economics and Finance.
    5. Juncal Cunado & Susana Ferreira, 2014. "The Macroeconomic Impacts of Natural Disasters: The Case of Floods," Land Economics, University of Wisconsin Press, vol. 90(1), pages 149-168.
    6. Kim, Youngwan & Nunnenkamp, Peter & Bagchi, Chandreyee, 2014. "Natural disasters and private donations to NGOs: The effects of being present after the Tsunami in the Indian Ocean," Kiel Working Papers 1890, Kiel Institute for the World Economy (IfW).
    7. Subhani Keerthiratne & Richard S. J. Tol, 2017. "Impact of Natural Disasters on Financial Development," Economics of Disasters and Climate Change, Springer, vol. 1(1), pages 33-54, June.
    8. Goetz von Peter & Sebastian von Dahlen & Sweta C Saxena, 2012. "Unmitigated disasters? New evidence on the macroeconomic cost of natural catastrophes," BIS Working Papers 394, Bank for International Settlements.
    9. Rohan Best & Paul J Burke, 2017. "Macroeconomic impacts of the 2010 earthquake in Haiti," Departmental Working Papers 2017-15, The Australian National University, Arndt-Corden Department of Economics.
    10. repec:eee:wdevel:v:105:y:2018:i:c:p:231-247 is not listed on IDEAS
    11. Joanne Linnerooth-Bayer & Stefan Hochrainer-Stigler, 2015. "Financial instruments for disaster risk management and climate change adaptation," Climatic Change, Springer, vol. 133(1), pages 85-100, November.

    More about this item

    Keywords

    Disasters; Event Study; Official Development Assistance; ODA;

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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