The Effects of Natural Disasters on Human Capital Accumulation
In this paper I investigate the effects of disasters on human capital accumulation using an extensive panel dataset on natural disasters, covering 170 countries over a 25 year period (1980-2004). My analysis shows that disasters have both a direct, contemporaneous effect and a long-term, indirect effect on human capital. While the direct effects - primarily related to injury, illness and death suffered as a result of the disaster - are relatively straightforward, the indirect effects will depend on household decision-making in the aftermath of the disaster. Treating human capital as a long-term investment decision, it is clear that access to finance is likely to be a crucial factor in household decisions about whether or not to invest in children's health and education. Indeed, my results show that aid flows are effective in mitigating the long-term impacts of disasters on health outcomes. However, for school enrollment rates, the longer-term effects of disasters are dependent on the availability of credit. These findings could have important policy implications. The indirect effects are unlikely to have been identified in previous analyses that focus on the short-term impacts of natural disasters. Given the importance of human capital in the process of economic development, the results presented here suggest that natural disasters represent a significant threat to the development prospects of relatively poor countries.
|Date of creation:||Nov 2011|
|Date of revision:||Feb 2012|
|Contact details of provider:|| Postal: |
Phone: 00 353 1 896 3888
Fax: 00 353 1 896 3939
Web page: http://www.tcd.ie/iiis/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Becker, Gary S & Tomes, Nigel, 1979. "An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1153-89, December.
- Alderman,Harold & Hoddinott, John & Kinsey, Bill, 2003.
"Long-term consequences of early childhood malnutrition,"
168, International Food Policy Research Institute (IFPRI).
- Harold Alderman & John Hoddinott & Bill Kinsey, 2006. "Long term consequences of early childhood malnutrition," Oxford Economic Papers, Oxford University Press, vol. 58(3), pages 450-474, July.
- Alderman,Harold & Hoddinott, John & Kinsey, Bill, 2003. "Long-term consequences of early childhood malnutrition," FCND discussion papers 168, International Food Policy Research Institute (IFPRI).
- Harold Alderman & John Hoddinott & Bill Kinsey, 2004. "Long Term Consequences Of Early Childhood Malnutrition," HiCN Working Papers 09, Households in Conflict Network.
- David E. Bloom & David Canning & Jaypee Sevilla, 2001. "Economic Growth and the Demographic Transition," NBER Working Papers 8685, National Bureau of Economic Research, Inc.
- Loury, Glenn C, 1981. "Intergenerational Transfers and the Distribution of Earnings," Econometrica, Econometric Society, vol. 49(4), pages 843-67, June.
- Zimmerman, Frederick J. & Carter, Michael R., 2003.
"Asset smoothing, consumption smoothing and the reproduction of inequality under risk and subsistence constraints,"
Journal of Development Economics,
Elsevier, vol. 71(2), pages 233-260, August.
- Frederic Zimmerman & MICHAEL R. CARTER, . "Asset Smoothing, Consumption Smoothing and the Reproduction for Inequality under Risk and Subsistence Constraints," Wisconsin-Madison Agricultural and Applied Economics Staff Papers 402, Wisconsin-Madison Agricultural and Applied Economics Department.
- Lance J. Lochner & Alexander Monge-Naranjo, 2011.
"The Nature of Credit Constraints and Human Capital,"
American Economic Review,
American Economic Association, vol. 101(6), pages 2487-2529, October.
- Lance J. Lochner, 2009. "The Nature of Credit Constraints and Human Capital," 2009 Meeting Papers 745, Society for Economic Dynamics.
- Lance J. Lochner & Alexander Monge-Naranjo, 2010. "The Nature of Credit Constraints and Human Capital," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20101, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
- Lance Lochner & Alexander Monge-Naranjo, 2010. "The Nature of Credit Constraints and Human Capital," Working Papers 2011-024, Human Capital and Economic Opportunity Working Group.
- Lance J. Lochner & Alexander Monge-Naranjo, 2008. "The Nature of Credit Constraints and Human Capital," NBER Working Papers 13912, National Bureau of Economic Research, Inc.
- Thomas K.J. McDermott & Frank Barry & Richard S.J. Tol, 2013.
"Disasters and Development: Natural Disasters, Credit Constraints and Economic Growth,"
CEDI Discussion Paper Series
13-03, Centre for Economic Development and Institutions(CEDI), Brunel University.
- McDermott, Thomas K. J. & Barry, Frank & Tol, Richard S. J., 2011. "Disasters and Development: Natural Disasters, Credit Constraints and Economic Growth," Papers WP411, Economic and Social Research Institute (ESRI).
- Thomas K.J. McDermott, . "Disasters and Development: Natural Disasters, Credit Constraints and Economic Growth," The Institute for International Integration Studies Discussion Paper Series iiisdp363, IIIS.
- Jalan, Jyotsna & Ravallion, Martin, 2001.
"Household income dynamics in rural China,"
Policy Research Working Paper Series
2706, The World Bank.
- Stefan Dercon, 2003.
"Growth and Shocks: evidence from rural Ethiopia,"
CSAE Working Paper Series
2003-12, Centre for the Study of African Economies, University of Oxford.
- Baez, Javier E. & de la Fuente, Alejandro & Santos, Indhira, 2010. "Do Natural Disasters Affect Human Capital? An Assessment Based on Existing Empirical Evidence," IZA Discussion Papers 5164, Institute for the Study of Labor (IZA).
- William A. Masters & Margaret S. McMillan, 2000.
"Climate and Scale In Economic Growth,"
CID Working Papers
48, Center for International Development at Harvard University.
- William A Masters and Margaret S McMillan, 2000. "Climate and Scale in Economic Growth," Economics Series Working Papers WPS/2000-13, University of Oxford, Department of Economics.
- Masters, William A. & McMillan, Margaret S., 2001. "Climate And Scale In Economic Growth," Miscellaneous Papers 11845, Agecon Search.
- Margaret S. McMillan & William A. Masters, 2000. "Climate and scale in economic growth," CSAE Working Paper Series 2000-13, Centre for the Study of African Economies, University of Oxford.
- Levine, Ross & Loayza, Norman & Beck, Thorsten, 2000.
"Financial intermediation and growth: Causality and causes,"
Journal of Monetary Economics,
Elsevier, vol. 46(1), pages 31-77, August.
- Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series, in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084 Central Bank of Chile.
- Levine, Ross & Loayza, Norman & Beck, Thorsten, 1999. "Financial intermediation and growth : Causality and causes," Policy Research Working Paper Series 2059, The World Bank.
- Thorsten Beck & Ross Levine & Norman Loayza, 1999. "Financial Intermediation and Growth: Causality and Causes," Working Papers Central Bank of Chile 56, Central Bank of Chile.
- Jacoby, Hanan G, 1994. "Borrowing Constraints and Progress through School: Evidence from Peru," The Review of Economics and Statistics, MIT Press, vol. 76(1), pages 151-60, February.
- N. Gregory Mankiw & David Romer & David N. Weil, 1990.
"A Contribution to the Empirics of Economic Growth,"
NBER Working Papers
3541, National Bureau of Economic Research, Inc.
- Jesus Crespo Cuaresma, 2010.
"Natural Disasters and Human Capital Accumulation,"
World Bank Economic Review,
World Bank Group, vol. 24(2), pages 280-302, July.
- Barro, R.J., 1989.
"Economic Growth In A Cross Section Of Countries,"
RCER Working Papers
201, University of Rochester - Center for Economic Research (RCER).
- Barry, Frank, 1999. "Government Consumption and Private Investment in Closed and Open Economies," Journal of Macroeconomics, Elsevier, vol. 21(1), pages 93-106, January.
- Lokshin, Michael & Ravallion, Martin, 2000. "Short-lived shocks with long-lived impacts? - household income dynamics in a transition economy," Policy Research Working Paper Series 2459, The World Bank.
- Flug, Karnit & Spilimbergo, Antonio & Wachtenheim, Erik, 1998.
"Investment in education: do economic volatility and credit constraints matter?,"
Journal of Development Economics,
Elsevier, vol. 55(2), pages 465-481, April.
- Karnit Flug & Antonio Spilimbergo & Erik Wachtenheim, 1996. "Investment in Education: Do Economic Volatility and Credit Constraints Matter?," Research Department Publications 4000, Inter-American Development Bank, Research Department.
- repec:ner:tilbur:urn:nbn:nl:ui:12-3125519 is not listed on IDEAS
- Taubman, Paul, 1989. "Role of Parental Income in Educational Attainment," American Economic Review, American Economic Association, vol. 79(2), pages 57-61, May.
- 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.
When requesting a correction, please mention this item's handle: RePEc:iis:dispap:iiisdp391. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Colette Keleher)
If references are entirely missing, you can add them using this form.