Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?

The debate on whether natural disasters cause significant macroeconomic impacts and indeed hinder development is ongoing. Most analyses along these lines have focused on impacts on gross domestic product. This paper looks beyond this standard natio...

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Main Author:	Mechler, Reinhard
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNTING ADVERSE CONSEQUENCES ADVERSE EFFECTS ADVERSE IMPACT AGRICULTURE AIR POLLUTION CALCULATION CALCULATIONS CAPITAL ACCUMULATION CAPITAL STOCK CAPITAL STOCKS CENTRE FOR RESEARCH ON THE EPIDEMIOLOGY CLIMATE CHANGE COMPARATIVE ANALYSIS CONTRIBUTION CRED DAMAGES DEMOGRAPHIC DEMOGRAPHIC CHANGE DEPRECIATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT BANK DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DISASTER DISASTER COMMUNITY DISASTER EVENTS DISASTER PREVENTION DISASTER RECOVERY DISASTER REDUCTION DISASTER RISK DISASTER RISK REDUCTION DISASTERS DISCOUNT RATE DISCOUNT RATES DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECONOMIC DEVELOPMENT ECONOMIC INFORMATION ECONOMIC RISK EMERGING ECONOMIES ENTRY POINT EXTREME EVENTS FINANCIAL LOSSES FIXED CAPITAL FLOOD FLOODING FLOODS FOREST FIRES GDP GDP DEFLATOR GLOBALIZATION GNP GROSS DOMESTIC PRODUCT GROSS INCOME GROSS NATIONAL PRODUCT GROSS NATIONAL SAVINGS HUMAN CAPITAL HURRICANE HURRICANES INCOME INCOME GROUPS INSURANCE INSURANCE COMPANIES INVESTING LOW INCOME LOW INCOME GROUP LOW-INCOME LOW-INCOME COUNTRIES LOW-INCOME GROUP LOW-INCOME GROUPS NATIONAL INCOME NATURAL CATASTROPHES NATURAL DISASTER NATURAL DISASTER REDUCTION NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCE NATURAL RESOURCES NET CAPITAL NONGOVERNMENTAL ORGANIZATIONS OUTPUT PER CAPITA INCOME POLITICAL ECONOMY PREDICTABILITY PRESENT VALUE RECONSTRUCTION REGRESSION ANALYSIS REINSURANCE REINVESTMENTS RELIEF RENTS RISK MANAGEMENT SAVINGS SOCIAL CAPITAL SOCIAL COSTS SOCIAL WELFARE STOCKS STORM STORMS SUDDEN ONSET DISASTERS SUSTAINABLE DEVELOPMENT SYSTEMS ANALYSIS THIRD WORLD TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TROPICAL CYCLONES VOLATILITY WEALTH WORLD DEVELOPMENT INDICATORS
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090706082915 http://hdl.handle.net/10986/4179

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spelling	okr-10986-41792021-04-23T14:02:16Z Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption? Mechler, Reinhard ACCOUNTING ADVERSE CONSEQUENCES ADVERSE EFFECTS ADVERSE IMPACT AGRICULTURE AIR POLLUTION CALCULATION CALCULATIONS CAPITAL ACCUMULATION CAPITAL STOCK CAPITAL STOCKS CENTRE FOR RESEARCH ON THE EPIDEMIOLOGY CLIMATE CHANGE COMPARATIVE ANALYSIS CONTRIBUTION CRED DAMAGES DEMOGRAPHIC DEMOGRAPHIC CHANGE DEPRECIATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT BANK DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DISASTER DISASTER COMMUNITY DISASTER EVENTS DISASTER PREVENTION DISASTER RECOVERY DISASTER REDUCTION DISASTER RISK DISASTER RISK REDUCTION DISASTERS DISCOUNT RATE DISCOUNT RATES DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECONOMIC DEVELOPMENT ECONOMIC INFORMATION ECONOMIC RISK EMERGING ECONOMIES ENTRY POINT EXTREME EVENTS FINANCIAL LOSSES FIXED CAPITAL FLOOD FLOODING FLOODS FOREST FIRES GDP GDP DEFLATOR GLOBALIZATION GNP GROSS DOMESTIC PRODUCT GROSS INCOME GROSS NATIONAL PRODUCT GROSS NATIONAL SAVINGS HUMAN CAPITAL HURRICANE HURRICANES INCOME INCOME GROUPS INSURANCE INSURANCE COMPANIES INVESTING LOW INCOME LOW INCOME GROUP LOW-INCOME LOW-INCOME COUNTRIES LOW-INCOME GROUP LOW-INCOME GROUPS NATIONAL INCOME NATURAL CATASTROPHES NATURAL DISASTER NATURAL DISASTER REDUCTION NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCE NATURAL RESOURCES NET CAPITAL NONGOVERNMENTAL ORGANIZATIONS OUTPUT PER CAPITA INCOME POLITICAL ECONOMY PREDICTABILITY PRESENT VALUE RECONSTRUCTION REGRESSION ANALYSIS REINSURANCE REINVESTMENTS RELIEF RENTS RISK MANAGEMENT SAVINGS SOCIAL CAPITAL SOCIAL COSTS SOCIAL WELFARE STOCKS STORM STORMS SUDDEN ONSET DISASTERS SUSTAINABLE DEVELOPMENT SYSTEMS ANALYSIS THIRD WORLD TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TROPICAL CYCLONES VOLATILITY WEALTH WORLD DEVELOPMENT INDICATORS The debate on whether natural disasters cause significant macroeconomic impacts and indeed hinder development is ongoing. Most analyses along these lines have focused on impacts on gross domestic product. This paper looks beyond this standard national accounting aggregate, and examines whether traditional and alternative national savings measures combined with adjustments for the destruction of capital stocks may contribute to better explaining post-disaster changes in welfare as measured by changes in consumption expenditure. The author concludes that including disaster asset losses may help to better explain variations in post-disaster consumption, albeit almost exclusively for the group of low-income countries. The observed effect is rather small and in the range of a few percent of the explained variation. For low-income countries, capital stock and changes therein, such as forced by disaster shocks, seem to play a more important role than for higher-income economies, where human capital and technological progress become crucial. There are important data constraints and uncertainties, particularly regarding the quality of disaster loss data and the shares of capital stock losses therein. Another important challenge potentially biasing the results is the lack of data on alternative savings measures for many disaster-exposed lower-income countries and small island states. 2012-03-19T19:11:21Z 2012-03-19T19:11:21Z 2009-07-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090706082915 http://hdl.handle.net/10986/4179 English Policy Research working paper ; no. WPS 4988 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTING ADVERSE CONSEQUENCES ADVERSE EFFECTS ADVERSE IMPACT AGRICULTURE AIR POLLUTION CALCULATION CALCULATIONS CAPITAL ACCUMULATION CAPITAL STOCK CAPITAL STOCKS CENTRE FOR RESEARCH ON THE EPIDEMIOLOGY CLIMATE CHANGE COMPARATIVE ANALYSIS CONTRIBUTION CRED DAMAGES DEMOGRAPHIC DEMOGRAPHIC CHANGE DEPRECIATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT BANK DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DISASTER DISASTER COMMUNITY DISASTER EVENTS DISASTER PREVENTION DISASTER RECOVERY DISASTER REDUCTION DISASTER RISK DISASTER RISK REDUCTION DISASTERS DISCOUNT RATE DISCOUNT RATES DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECONOMIC DEVELOPMENT ECONOMIC INFORMATION ECONOMIC RISK EMERGING ECONOMIES ENTRY POINT EXTREME EVENTS FINANCIAL LOSSES FIXED CAPITAL FLOOD FLOODING FLOODS FOREST FIRES GDP GDP DEFLATOR GLOBALIZATION GNP GROSS DOMESTIC PRODUCT GROSS INCOME GROSS NATIONAL PRODUCT GROSS NATIONAL SAVINGS HUMAN CAPITAL HURRICANE HURRICANES INCOME INCOME GROUPS INSURANCE INSURANCE COMPANIES INVESTING LOW INCOME LOW INCOME GROUP LOW-INCOME LOW-INCOME COUNTRIES LOW-INCOME GROUP LOW-INCOME GROUPS NATIONAL INCOME NATURAL CATASTROPHES NATURAL DISASTER NATURAL DISASTER REDUCTION NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCE NATURAL RESOURCES NET CAPITAL NONGOVERNMENTAL ORGANIZATIONS OUTPUT PER CAPITA INCOME POLITICAL ECONOMY PREDICTABILITY PRESENT VALUE RECONSTRUCTION REGRESSION ANALYSIS REINSURANCE REINVESTMENTS RELIEF RENTS RISK MANAGEMENT SAVINGS SOCIAL CAPITAL SOCIAL COSTS SOCIAL WELFARE STOCKS STORM STORMS SUDDEN ONSET DISASTERS SUSTAINABLE DEVELOPMENT SYSTEMS ANALYSIS THIRD WORLD TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TROPICAL CYCLONES VOLATILITY WEALTH WORLD DEVELOPMENT INDICATORS
spellingShingle	ACCOUNTING ADVERSE CONSEQUENCES ADVERSE EFFECTS ADVERSE IMPACT AGRICULTURE AIR POLLUTION CALCULATION CALCULATIONS CAPITAL ACCUMULATION CAPITAL STOCK CAPITAL STOCKS CENTRE FOR RESEARCH ON THE EPIDEMIOLOGY CLIMATE CHANGE COMPARATIVE ANALYSIS CONTRIBUTION CRED DAMAGES DEMOGRAPHIC DEMOGRAPHIC CHANGE DEPRECIATION DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT BANK DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DISASTER DISASTER COMMUNITY DISASTER EVENTS DISASTER PREVENTION DISASTER RECOVERY DISASTER REDUCTION DISASTER RISK DISASTER RISK REDUCTION DISASTERS DISCOUNT RATE DISCOUNT RATES DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECONOMIC DEVELOPMENT ECONOMIC INFORMATION ECONOMIC RISK EMERGING ECONOMIES ENTRY POINT EXTREME EVENTS FINANCIAL LOSSES FIXED CAPITAL FLOOD FLOODING FLOODS FOREST FIRES GDP GDP DEFLATOR GLOBALIZATION GNP GROSS DOMESTIC PRODUCT GROSS INCOME GROSS NATIONAL PRODUCT GROSS NATIONAL SAVINGS HUMAN CAPITAL HURRICANE HURRICANES INCOME INCOME GROUPS INSURANCE INSURANCE COMPANIES INVESTING LOW INCOME LOW INCOME GROUP LOW-INCOME LOW-INCOME COUNTRIES LOW-INCOME GROUP LOW-INCOME GROUPS NATIONAL INCOME NATURAL CATASTROPHES NATURAL DISASTER NATURAL DISASTER REDUCTION NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCE NATURAL RESOURCES NET CAPITAL NONGOVERNMENTAL ORGANIZATIONS OUTPUT PER CAPITA INCOME POLITICAL ECONOMY PREDICTABILITY PRESENT VALUE RECONSTRUCTION REGRESSION ANALYSIS REINSURANCE REINVESTMENTS RELIEF RENTS RISK MANAGEMENT SAVINGS SOCIAL CAPITAL SOCIAL COSTS SOCIAL WELFARE STOCKS STORM STORMS SUDDEN ONSET DISASTERS SUSTAINABLE DEVELOPMENT SYSTEMS ANALYSIS THIRD WORLD TOTAL FACTOR PRODUCTIVITY TOTAL FACTOR PRODUCTIVITY GROWTH TROPICAL CYCLONES VOLATILITY WEALTH WORLD DEVELOPMENT INDICATORS Mechler, Reinhard Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
geographic_facet	The World Region The World Region
relation	Policy Research working paper ; no. WPS 4988
description	The debate on whether natural disasters cause significant macroeconomic impacts and indeed hinder development is ongoing. Most analyses along these lines have focused on impacts on gross domestic product. This paper looks beyond this standard national accounting aggregate, and examines whether traditional and alternative national savings measures combined with adjustments for the destruction of capital stocks may contribute to better explaining post-disaster changes in welfare as measured by changes in consumption expenditure. The author concludes that including disaster asset losses may help to better explain variations in post-disaster consumption, albeit almost exclusively for the group of low-income countries. The observed effect is rather small and in the range of a few percent of the explained variation. For low-income countries, capital stock and changes therein, such as forced by disaster shocks, seem to play a more important role than for higher-income economies, where human capital and technological progress become crucial. There are important data constraints and uncertainties, particularly regarding the quality of disaster loss data and the shares of capital stock losses therein. Another important challenge potentially biasing the results is the lack of data on alternative savings measures for many disaster-exposed lower-income countries and small island states.
format	Publications & Research :: Policy Research Working Paper
author	Mechler, Reinhard
author_facet	Mechler, Reinhard
author_sort	Mechler, Reinhard
title	Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
title_short	Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
title_full	Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
title_fullStr	Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
title_full_unstemmed	Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?
title_sort	disasters and economic welfare : can national savings help explain post-disaster changes in consumption?
publishDate	2012
url	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090706082915 http://hdl.handle.net/10986/4179
_version_	1764390284384272384

Disasters and Economic Welfare : Can National Savings Help Explain Post-disaster Changes in Consumption?

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