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Assessing socioeconomic resilience to floods in 90 countries

Author

Listed:
  • Hallegatte,Stephane
  • Bangalore,Mook
  • Vogt-Schilb,Adrien Camille

Abstract

This paper presents a model to assess the socioeconomic resilience to natural disasters of an economy, defined as its capacity to mitigate the impact of disaster-related asset losses on welfare, and a tool to help decision makers identify the most promising policy options to reduce welfare losses due to floods. Calibrated with household surveys, the model suggests that welfare losses from the July 2005 floods in Mumbai were almost double the asset losses, because losses were concentrated on poor and vulnerable populations. Applied to river floods in 90 countries, the model provides estimates of country-level socioeconomic resilience. Because floods disproportionally affect poor people, each $1 of global flood asset loss is equivalent to a $1.6 reduction in the affected country's national income, on average. The model also assesses and ranks policy levers to reduce flood losses in each country. It shows that considering asset losses is insufficient to assess disaster risk management policies. The same reduction in asset losses results in different welfare gains depending on who benefits. And some policies, such as adaptive social protection, do not reduce asset losses, but still reduce welfare losses. Asset and welfare losses can even move in opposite directions: increasing by one percentage point the share of income of the bottom 20 percent in the 90 countries would increase asset losses by 0.6 percent, since more wealth would be at risk. But it would also reduce the impact of income losses on wellbeing, and ultimately reduce welfare losses by 3.4 percent.

Suggested Citation

  • Hallegatte,Stephane & Bangalore,Mook & Vogt-Schilb,Adrien Camille, 2016. "Assessing socioeconomic resilience to floods in 90 countries," Policy Research Working Paper Series 7663, The World Bank.
  • Handle: RePEc:wbk:wbrwps:7663
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    File URL: http://documents.worldbank.org/curated/en/387821467309551281/pdf/WPS7663.pdf
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    References listed on IDEAS

    as
    1. Stephane Hallegatte & Mook Bangalore & Laura Bonzanigo & Marianne Fay & Tamaro Kane & Ulf Narloch & Julie Rozenberg & David Treguer & Adrien Vogt-Schilb, 2016. "Shock Waves," World Bank Publications, The World Bank, number 22787, December.
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    Cited by:

    1. Ilan Noy & Nguyen Doan & Benno Ferrarini & Donghyun Park, 2020. "Measuring the Economic Risk of Covid-19," CESifo Working Paper Series 8373, CESifo.
    2. Yonson, Rio & Noy, Ilan, 2018. "Measurement of economic welfare risk and resilience of the Philippine regions," Working Paper Series 6963, Victoria University of Wellington, School of Economics and Finance.

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