Understanding Vulnerability to Poverty and Natural Disasters in Latin America and the Caribbean

This paper provides the first measures of vulnerability to poverty in Latin America and the Caribbean at the household level looking at natural hazards such as floods, landslides, cyclones, earthquakes, and droughts. It considers seven countries in the region: Brazil, the Dominican Republic, Ecuador, El Salvador, Honduras, Mexico, and Peru. The paper constructs a unique data base that links household surveys from the Socio-Economic Database for Latin America and the Caribbean database to data on natural hazards from the ThinkHazard database and Emergency Events Database, which permits the first estimates of how household exposure to natural events raises the probability of being poor. The results suggest that vulnerability to poverty is related to households' coping and adaptation strategies, and there is great heterogeneity depending on the natural hazard assumed. The evidence generated by this approach helps in understanding the lack of coping mechanisms and adaptation strategies among vulnerable households. This understanding can be used to mitigate the effects of natural disasters. The evidence-based approach is useful for identifying specific vulnerable communities in disaster-prone areas. Furthermore, the information can be presented in the most disaggregated representative unit that the data allow so that policy makers can build more efficient management policies in their location.