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Estimating the Direct Economic Damage of the Earthquake in Haiti

Author

Listed:
  • Eduardo Cavallo

    ()

  • Andrew Powell

    ()

  • Oscar Becerra

    ()

Abstract

This paper uses simple regression techniques to make an initial assessment of the monetary damages caused by the January 12, 2010 earthquake that struck Haiti. Damages are estimated for a disaster with both 200,000 and 250,000 total dead and missing (i.e., the range of mortality that the earthquake is estimated to have caused) using Haiti’s economic and demographic data. The base estimate is US$8.1bn for a death toll of 250,000, but for several reasons this may be a lower- bound estimate. An estimate of US$13.9bn for the same death toll is within statistical error. While the results are subject to many caveats, the implications of such an estimate are significant. Raising such a figure will require many donors—bilateral, multilateral and private. Hence excellent coordination of funding and execution will be the key to ensuring the efficient use of funds.

Suggested Citation

  • Eduardo Cavallo & Andrew Powell & Oscar Becerra, 2010. "Estimating the Direct Economic Damage of the Earthquake in Haiti," Research Department Publications 4652, Inter-American Development Bank, Research Department.
  • Handle: RePEc:idb:wpaper:4652
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    References listed on IDEAS

    as
    1. Matteo Bobba & Andrew Powell, 2006. "Multilateral Intermediation of Foreign Aid: What is the Trade-Off for Donor Countries?," Research Department Publications 4500, Inter-American Development Bank, Research Department.
    2. Nicole Cornell Sadowski & Daniel Sutter, 2005. "Hurricane Fatalities and Hurricane Damages: Are Safer Hurricanes More Damaging?," Southern Economic Journal, Southern Economic Association, vol. 72(2), pages 422-432, October.
    3. Toya, Hideki & Skidmore, Mark, 2007. "Economic development and the impacts of natural disasters," Economics Letters, Elsevier, vol. 94(1), pages 20-25, January.
    4. Matteo Bobba & Andrew Powell, 2006. "Multilateral Intermediation of Foreign Aid: What is the Trade-Off for Donor Countries?," Research Department Publications 4500, Inter-American Development Bank, Research Department.
    5. 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.
    6. Kellenberg, Derek K. & Mobarak, Ahmed Mushfiq, 2008. "Does rising income increase or decrease damage risk from natural disasters?," Journal of Urban Economics, Elsevier, vol. 63(3), pages 788-802, May.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Natural disasters; direct economic damages; Haiti; earthquake; reconstruction; aid and development;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • F35 - International Economics - - International Finance - - - Foreign Aid

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