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Great East Japan Earthquake and Risk Management for Small and Medium-Sized Enterprises ―How Do Japanese SMEs Prepare against Natural Disasters?-

Author

Listed:
  • Nobuyoshi Yamori

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)

  • Yoshihiro Asai

    (Meiji University, Japan and California State University, Northridge, USA)

Abstract

We conducted a questionnaire survey regarding insurance and risk management of small and medium-sized enterprises (SMEs) all over Japan in 2014. Based on that survey, this research examined who prepared less against natural disasters before the 2011 Great East Japan Earthquake and how seriously Japanese SMEs with poor risk management were affected by the earthquake. We find that SMEs in a weaker financial condition tended to take fewer measures against earthquakes before the Great East Japan Earthquake. We also find that companies in a weaker financial condition tend to prepare less for earthquake risks even after the Great Earthquake. Furthermore, we find that direct damages from the Great East Japan Earthquake were more serious for SMEs with poor risk management than for those with sound risk management.

Suggested Citation

  • Nobuyoshi Yamori & Yoshihiro Asai, 2017. "Great East Japan Earthquake and Risk Management for Small and Medium-Sized Enterprises ―How Do Japanese SMEs Prepare against Natural Disasters?-," Discussion Paper Series DP2017-14, Research Institute for Economics & Business Administration, Kobe University.
  • Handle: RePEc:kob:dpaper:dp2017-14
    as

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    File URL: http://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2017-14.pdf
    File Function: First version, 2017
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    References listed on IDEAS

    as
    1. Yamori, Nobuyoshi & Kobayashi, Takeshi, 2002. "Do Japanese Insurers Benefit from A Catastrophic Event?: Market Reactions to the 1995 Hanshin-Awaji Earthquake," Journal of the Japanese and International Economies, Elsevier, vol. 16(1), pages 92-108, March.
    2. Yamori, Nobuyoshi & Okada, Taishi & Kobayashi, Takeshi, 2009. "Preparing for Large Natural Catastrophes: The current state and challenges of earthquake insurance in Japan," MPRA Paper 8851, University Library of Munich, Germany.
    3. Michio Naoi & Miki Seko & Takuya Ishino, 2012. "Earthquake Risk in Japan: Consumers' Risk Mitigation Responses After the Great East Japan Earthquake," Journal of Economic Issues, Taylor & Francis Journals, vol. 46(2), pages 519-530.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Small and medium-sized enterprises (SMEs); Earthquake insurance; Risk management; Natural disasters;

    JEL classification:

    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies

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