Economic Effects of Natural Disasters: Theoretical Foundations, Methods, and Tools

Description

Economic Effects of Natural Disasters explores how natural disasters affect sources of economic growth and development. Using theoretical econometrics and real-world data, and drawing on advances in climate change economics, the book shows scholars and researchers how to use various research methods and techniques to investigate and respond to natural disasters. No other book presents empirical frameworks for the evaluation of the quality of macroeconomic research practice with a focus on climate change and natural disasters. Because many of these subjects are so large, different regions of the world use different approaches, hence this resource presents tailored economic applications and evidence. Front Cover Economic Effects of Natural Disasters Copyright Page Contents List of Contributors Editor Biographies Preface Reference 1 The Economic Impact of National Disaster Relief and Recovery Funding for Local Government Infrastructure in Tropical Nort... 1.1 Introduction 1.2 Background of the Region 1.3 Two Zones of Analysis 1.4 Natural Disaster Weather Events 1.5 Disaster Expenditure Funded 1.6 Infrastructure Affected 1.7 Annual Disaster Spending Compared With Capital Value 1.8 Reconstruction Works Impacts 1.9 Scale of Economic Impacts If the Restoration Work Did Not Take Place 1.9.1 Direct Impacts 1.9.2 Flow-On Effects 1.9.3 Developmental/Catalytic Effects 1.10 Comparison of Disaster Spending With Output of Vulnerable Industries 1.11 Importance of Outside Funding 2 The Effects of Natural Disasters on Stock Market Return and Volatility in Hong Kong 2.1 Introduction 2.2 Literature Review 2.3 ARMAX–EGARCHX Model 2.4 Data 2.5 Findings and Discussion 2.6 Conclusion References 3 Climate Change and Effects: A Qualitative Experience of Selected Older Adults 3.1 Introduction 3.2 Energy and Climate Crisis in Nigeria From a Social Perspective 3.3 Data and Methods 3.3.1 Study Area 3.3.2 Sampling Procedure 3.3.3 Data Analysis 3.4 Results 3.4.1 Demographic Characteristics of Participants 3.4.2 Older Adults and Their Understanding of Climate Change 3.4.3 Effects of Climate Change on Older Adults 3.4.4 Suggestions to Overcome Climate Change 3.5 Discussion and Conclusion References Further Reading 4 Natural Disasters and Labor Markets: Impacts of Cyclones on Employment in Northeast Australia 4.1 Introduction 4.2 Background to Cyclones in Northeast Australia 4.3 Impact of Cyclones on Employment and Labor Markets 4.3.1 Precyclone: Cyclone Warning Issued 4.3.2 During the Cyclone 4.3.3 Postcyclone 4.4 Methodology 4.5 Findings and Discussion 4.5.1 Overall Results 4.6 Employment—Work, Workers, and Businesses 4.7 Conclusion References 5 Natural Disasters, Geography, and International Tourism 5.1 Introduction 5.2 A Review of the Literature 5.3 Data and Measures 5.3.1 Dependent Variable 5.3.2 Explanatory Variables 5.3.3 Control Variables 5.4 Empirical Model 5.5 Summary Statistics 5.6 Discussion of Empirical Results 5.6.1 The Contemporaneous Link Between Natural Disasters and International Tourist Flows 5.6.2 The Dynamic Link Between Natural Disasters and International Tourist Flows 5.6.3 The Contemporaneous Link Between Natural Disasters and International Tourist Flows by Regions 5.6.4 The Dynamic Link Between Natural Disasters and International Tourist Flows by Regions 5.7 Robustness Checks 5.7.1 The Contemporaneous and Dynamic Link Between Natural Disasters and International Tourist Flows Regions 5.8 Conclusion References 6 Women and Economic Dimensions of Climate Change 6.1 Introduction 6.2 Methodological Approach 6.3 Gender Barriers, Vulnerability, and Adaptation 6.4 Gender and Economic Exclusion 6.5 Differentiated Climate Change Impacts: Emerging Themes from Research 6.5.1 Climate Change and Gender 6.5.2 Emerging Themes From Research on Climate Change and Gender 6.5.3 Livelihoods and Economic Development 6.6 Analysis and Discussion 6.7 Conclusion References 7 Foreign Direct Investment, Natural Disasters, and Economic Growth of Host Countries 7.1 Introduction 7.2 Literature Review 7.3 Methodology 7.4 Results 7.4.1 Overview of Natural Disaster Around the World 7.4.2 Natural Disaster and Inward Foreign Direct Investment Stock in Countries With Different Economic Development Levels 7.4.3 Natural Disaster: Destruction to the Economy or a Destructive Growth Opportunity? 7.4.4 Does Foreign Direct Investment Contribute to Economic Recovery After Disasters?—A Regression Analysis 7.4.4.1 Overall Results 7.4.4.2 Different economic development levels and different categories of disasters 7.4.5 “Footlooseness” of Foreign Direct Investment 7.4.6 “Crowding-Out” or “Crowding-In” Effect of Foreign Direct Investment Following Disaster: Effect of Foreign Direct Inve... 7.5 Conclusion References Appendix 8 Mitigating Impact From Natural Disasters, Building Resilience in Tourism: The Case of Kerala 8.1 Introduction 8.2 Methodology, Data Collection, and Analysis 8.3 Kerala and the Tourist Industry 8.4 Kerala 2018 Flood and Its Impact 8.5 Post–Disaster Management 8.6 Post-2018 Kerala Floods 8.7 Challenges Faced 8.8 Recommendations References 9 Showcasing Entrepreneurs’ Responses to Severe Drought: Qualitative Findings From Cape Town, South Africa 9.1 Contextualization: Drought and Entrepreneurship 9.2 Background Literature 9.2.1 Institutional Theory in Entrepreneurship Research 9.2.2 Ecological Challenges of Entrepreneurs in South Africa 9.3 Methodology 9.3.1 Research Context: Cape Town, South Africa 9.3.2 Research Design 9.3.3 Sample Selection 9.3.4 Data Collection 9.3.5 Data Analysis 9.4 Findings 9.5 Discussion 9.5.1 Contribution to the Literature 9.5.2 Limitations and Recommendations for Future Research 9.5.3 Implications for Practice 9.6 Conclusion References 10 The Influence of Environmental Pollution and Drought on the Satisfaction With Life of Entrepreneurs in Zambia’s Mining S... 10.1 Point of Departure: Entrepreneurship in Sub-Saharan Africa 10.2 Arriving at Environmental Pollution, Drought, and Satisfaction With Life of Entrepreneurs 10.2.1 The Research Question 10.3 Methodology 10.3.1 Research Context: Zambia 10.3.2 Data Collection 10.3.3 Data Analysis 10.4 Results 10.4.1 Descriptive Statistics 10.4.2 Correlation Analyses 10.4.3 Regression Analyses 10.5 Concluding Discussion 10.5.1 Limitations and Recommendations for Future Research References 11 Environmental Resilience of Bottom of the Pyramid Strategies Toward Single-Use Plastics: A Recipe From an Emerging Economy 11.1 Setting the Scene: Single-Use Plastics, Bottom of the Pyramid, and Frugal Innovation 11.2 Methodology 11.2.1 Research Context: India’s Bottom of the Pyramid 11.2.2 Data Collection 11.2.3 Data Analyses 11.3 Findings 11.3.1 Consumer Behavior 11.3.2 Market Forces 11.3.3 Entrepreneurial/Innovation Activities 11.3.4 Socio-political Factors and Themes 11.3.5 Trends and Interconnections 11.4 Concluding Discussion 11.4.1 Theoretical Implications 11.5 Future Outlook References 12 Semantic Technologies for Disaster Management: Network Models and Methods of Diagrammatic Reasoning 12.1 Introduction 12.2 Applied Category Theory 12.3 Diagrammatic Reasoning 12.3.1 Case Study One 12.3.2 Case Study Two 12.4 Related Developments in Software Engineering 12.5 Conclusion References 13 Methods and Insights on How to Explore Human Behavior in the Disaster Environment 13.1 Introduction 13.2 Experimentation 13.2.1 Laboratory Experiments 13.2.2 Natural Experiments 13.2.3 Field Experiments 13.3 Simulations 13.4 Virtual Reality 13.5 Comparative and Narrative Analysis 13.6 High-Quality Individual-Level Panel Data Analysis 13.7 Apps and Portable Sensing Systems 13.8 Conclusion References 14 State-Wide Effects of Natural Disasters on the Labor Market 14.1 Introduction 14.2 Research Gap 14.3 Natural Disaster Profile of the Study Area 14.4 Theoretical Model 14.5 Econometric Model 14.6 Data 14.6.1 Disaster Data 14.6.2 Other Variables and Sources 14.7 Methods 14.7.1 Preliminary Analysis 14.7.1.1 Trend analysis and cointegration 14.7.2 VAR and Structural VAR Models Identification 14.7.3 Impulse Response Analysis 14.8 conclusion References 15 Costing a Natural Disaster: An Accounting Perspective 15.1 Counting the Cost 15.1.1 What Is Considered Relevant 15.1.2 What Is Not Included 15.1.3 Ad hoc Accounting Systems 15.2 Previous Research 15.2.1 Power and Accounting 15.2.2 Classification and Costs 15.3 Suggestions for Further Research 15.3.1 Searching for Missing Data 15.4 Conclusion References Further Reading 16 Typical Social Adaptation Measures in Climate Change Planning: A Tropical Region Case Study 16.1 Introduction 16.2 Methods 16.3 Results: typical adaptation measures arising from the TNQ social resilience assessment 16.3.1 Enhanced Regional and Local Land Use Planning 16.3.2 Infrastructure Risk Identification 16.3.3 Climate Information Services 16.3.4 New Infrastructure Funding Models 16.3.5 Recasting Research Models 16.3.6 Collaborative Alliances Around Agriculture and Fisheries 16.3.7 Small Business Resilience 16.3.8 Insurance Reform 16.3.9 Disaster Coordination and Response 16.3.10 Capitalizing on the Region’s Climate Adaptation Skills 16.3.11 Regional Energy Reform in Tropical North Queensland 16.3.12 Regional Landscape Mitigation 16.3.13 Spatial Information Hubs for Property Scale Management and Response 16.3.14 Human Service Sector Capacity 16.3.15 Water Resource Management 16.3.16 Biosecurity and Health Risks 16.3.17 Long-Term Adaptive Regional Governance Models 16.4 Discussion and Conclusion: The Implications of Typical Social Adaptation Results Across the Tropics Acknowledgments References 17 The Impact of Natural Disasters and Climate Change on Agriculture: Findings From Vietnam 17.1 Introduction 17.2 Background: Natural Disasters and Climate Change in Vietnam 17.2.1 Overview of Vietnam’s Climate 17.2.2 Climate-Change Scenarios for Vietnam 17.2.3 An Overview of Natural Disasters in Vietnam 17.2.4 Institutional Framework for Natural Disasters and Climate Change in Vietnam 17.3 Impacts of Natural Disasters and Climate Change on Agriculture in Vietnam 17.3.1 Overview of Vietnam’s Agriculture 17.3.2 Impacts of Natural Disasters and Climate Change on Agricultural Production 17.4 Conclusion References 18 Economic Impact Assessment After a Natural Disaster Using DEMATEL Method 18.1 Introduction 18.2 Economic Impacts of a Natural Disaster 18.3 Research Methodology 18.3.1 Economic Impacts (E) of Natural Disasters 18.3.1.1 Economic impacts description 18.3.1.2 Generation of the matrix 18.3.2 Decision-Making Trial and Evaluation Laboratory Method 18.4 Results and Discussion 18.4.1 Direct and Indirect Impact 18.4.2 Results and Discussion (Indirect Economic Impact) 18.5 Conclusion Acknowledgment Conflict of Interest References Appendix 19 Climate Change and Natural Disasters: Macroeconomic Performance and Sustainable Development 19.1 Introduction 19.2 Literature Review on the Economics of Natural Disasters 19.3 Methodology and Data 19.3.1 Empirical Model Specification 19.3.2 Data 19.4 Empirical Results 19.4.1 Natural Disasters and Economic Growth 19.4.2 Natural Disasters and Private Sector Investment 19.4.3 Natural Disasters and Public Sector Spending 19.5 Concluding Remarks Acknowledgment Conflict of Interest References Appendix Countries Included 20 Natural Disasters: Macroeconomic Implications and Measurement Issues 20.1 Introduction 20.2 Economics of Natural Disasters: Theoretical Perspective 20.3 The Macroeconomic Impacts of Natural Disasters: Empirical Evidence 20.3.1 Cross-Sectional Studies 20.3.2 Panel Data Studies 20.3.3 Time Series Studies 20.3.4 Computable General Equilibrium Studies 20.4 Disaster Measurement and Modeling Issues 20.5 Concluding Remarks, Policy Implications, and Direction for Future Research Acknowledgment Conflict of Interest References Appendix 21 The Asian Tsunami and Tourism Industry: Impact and Recovery 21.1 Introduction 21.2 Preliminary Data Analysis 21.2.1 Maldives 21.2.2 Thailand 21.2.3 Sri Lanka 21.2.4 Indonesia 21.2.5 India 21.3 Methodology 21.3.1 Econometric Techniques 21.3.2 Autoregressive Integrated Moving Average Models 21.4 Estimation Results 21.4.1 Econometric Estimation 21.4.2 Autoregressive Integrated Moving Average Model Estimation and Forecasting 21.5 Concluding Comments References 22 Effect of Drought on Development of Children: Field Observations From the Drought-Prone District of Deccan Plateau of So... 22.1 Title Introduction to Creeping Disaster—Drought 22.1.1 The Study 22.1.2 Methodology 22.1.3 Description of Study Villages 22.1.4 Key Observations 22.1.5 Drought and Livelihood 22.1.6 Nutrition 22.1.7 Health 22.1.7.1 Water and sanitation and child protection 22.1.8 Education 22.1.9 Way Forward 22.1.10 Measures to Address Needs Under Drought Risk Reduction 22.1.10.1 Water and sanitation 22.1.10.2 Education 22.1.10.3 Drought awareness program 22.1.10.4 Capacity building 22.1.10.5 Training to the teachers 22.1.10.6 Capacity building (resilience) in society 22.1.10.7 Food and nutrition 22.1.10.8 Psychosocial care of the children 22.1.10.9 Micronutrients, malnutrition (hidden hunger) 22.1.10.10 Child protection 22.1.10.11 Department-wise measures 22.1.11 Drought Risk Reduction: Gaps in Governance References 23 Flood Disasters in Aba North Local Government Area of Abia State, Nigeria: Policy Options 23.1 Introduction 23.2 Method of Study 23.3 Description of the Study Area 23.4 The Concept of Flooding 23.5 Theoretical Framework 23.6 Major Causes of Flooding in Aba North Local Government Area 23.6.1 Flash Flooding 23.6.2 Groundwater Flooding 23.6.3 Poor Drainage System 23.7 Discussion of Findings 23.8 Concluding Remarks References 24 Institutional Response and Mechanisms to the Management of Natural Disaster in Nigeria 24.1 Introduction 24.2 Climate Change and Flood Disaster in Nigeria 24.3 Impact of Flood on Livelihood 24.4 Disaster Adaptation and Resilience/Community Coping Mechanisms in Nigeria 24.5 Institutional Response and Mechanisms to Flood Management in Nigeria 24.6 Disaster Mapping and Postdisaster Needs Assessment in Nigeria 24.7 Conclusion References 25 Challenges of Addressing Natural Disasters in Nigeria Through Public Policy Implementation: An Examination of Isuikwuato... 25.1 Introduction 25.2 The Nature of Soil and Gully Erosion Menace 25.3 Erosion-Induced Ecological and Economic Challenges 25.4 The Erosion-Induced Ecological Challenges of the People of Isuikwuato 25.4.1 Flooding 25.4.2 Landsliding 25.4.3 Deforestation 25.4.4 Road Destruction 25.5 The Erosion-Induced Economic Challenges of the People of Isuikwuato 25.5.1 Loss of Agricultural Produce and Agro-Related Sources of Livelihoods of the People 25.5.2 Breakdown of Properties of the People of Isuikwuato Due to Erosion Menace 25.5.3 Threat to Human Lives Due to Erosion Menace 25.5.4 The Establishment and Administration of Ecological Fund in Nigeria 25.6 Challenges of Addressing Natural Disasters in Nigeria Through Ecological Fund Policy 25.6.1 Mismanagement of the Ecological Fund at the Federal Government Level 25.6.2 Unhealthy Politics of Who Controls the Administration of the Ecological Fund 25.6.3 Possible Shortage of Fund to Attend to the Critical Ecological Problems 25.6.4 The Absence of National Assembly Oversight on the Management of the Ecological Fund 25.6.5 State Governments’ Mismanagement of Their Share of Ecological Fund 25.6.6 Politicization of Ecological Fund–Based Project Awards by the State Government 25.6.7 Award and Abandonment of Ecological Fund–Sponsored Projects 25.6.8 The Ecological Fund Office Working With Outdated Data Ecological Problem Sites 25.6.9 Disregard for the Sanctity of Human Life and the Provisions of the Constitution on the Protection of Lives and Prope... 25.6.10 Lack of Knowledge of the Processes and Procedures of Assessing Ecological Fund 25.6.11 Addressing Isuikwuato Erosion Menace Through the Ecological Fund Administration 25.6.12 Engaging the Erosion and Gullies It Creates Early to Combat It When It Is Still Small 25.6.13 Holding Both the State and Local Governments Accountable for Their Share of Ecological Funds Collectible Every Mont... 25.6.14 Engaging the Senator Representing Abia North Senatorial District and the Honorable Member of the House of Represent... 25.6.15 Ensuring That the Ecological Fund Office Is Kept Abreast of the Current State of Erosion Threat in Isuikwuato as Pr... 25.6.16 Acquaintance With the Processes and Procedure of Assessing Ecological Funds 25.6.17 The Local Government Can Look Out for International Donor Agencies Assistance 25.7 Conclusion References 26 Ecological and Economic Costs of Oil Spills in Niger Delta, Nigeria 26.1 Introduction 26.2 Status of Ecosystem in the Niger Delta Region of Nigeria 26.3 Environmental Hazards of Oil Spills 26.3.1 Human Health 26.3.2 Plants and Animals 26.3.2.1 Socioeconomic cost of oil spills to environment 26.4 Spillover Effects of Oil Spills to the Ecosystem of Niger Delta Region 26.4.1 Short-Term Effects 26.4.2 Long-Term Effects 26.5 The Impact of Oil Spill on Economic Growth and Development of the Niger Delta Region 26.6 Conclusion References 27 Socioeconomic Vulnerability to Urban Floods in Guwahati, Northeast India: An Indicator-Based Approach 27.1 Introduction 27.2 Urban Flood and Socioeconomic Vulnerability 27.3 Vulnerability Assessment: Theoretical Perspective 27.4 Assessment of Socioeconomic Urban Flood Vulnerability in Guwahati: LVI Approach 27.4.1 Calculating the Livelihood Vulnerability Index and Livelihood Vulnerability Index–IPCC 27.4.2 Livelihood Vulnerability Index–IPCC 27.5 Results and Discussions 27.6 Limitations and Future Implications 27.7 Conclusion References 28 Agricultural Production and Income in a Disaster Year: Findings from the study of Melalinjippattu village affected by cy... 28.1 Introduction 28.1.1 Nature of Disasters 28.1.2 Impact of Disasters on Economy 28.1.3 Disaster Profile of India 28.1.4 Current Study 28.2 Method 28.2.1 Cyclone Thane 28.2.2 Selection of Study Village 28.2.3 Melalinjippattu: The Study Village 28.3 Assessing Damage and Losses due to Cyclone Thane 28.3.1 Direct Losses 28.3.1.1 Loss and Damage of Lives, Houses, and Buildings 28.3.1.2 Losses and Damages to Crop 28.3.2 Indirect Damages and Losses 28.3.2.1 Impact of Cyclone on Land Holding and Cropping Pattern in the Village 28.3.2.2 Impact of Cyclone on Income From Cultivation 28.3.3 Impact on Wage Employment 28.3.3.1 Agricultural Wage Employment 28.3.3.2 Income From Nonagricultural Manual Work 28.4 Adaptation Strategies 28.4.1 Compensation 28.5 Conclusion Appendix References Further Reading 29 Socio-economic Vulnerabilities to Natural Disasters and Social Justice 29.1 Introduction 29.2 Constructing Disaster Vulnerability 29.3 Issues of Disaster Vulnerability 29.4 Potential Causes and Measures of Household and Community Vulnerability 29.5 Contributions of Local Knowledge, Human Rights, Social and Environmental Justice to the Mitigation of Disaster Vulnera... 29.6 Case Study of Townsville’s Monsoonal Floods 2019 29.7 Conclusion References Further Reading 30 Alternative Scenarios for Low-Carbon Transport in Nigeria: A Long-Range Energy Alternatives Planning System Model Applic... 30.1 Introduction 30.2 Methodology 30.2.1 The Long-Range Energy Alternatives Planning Modeling Tool 30.2.2 Scenarios 30.2.3 Cobenefits 30.3 Numerical Results and Analysis 30.3.1 Final Energy Demand 30.3.2 GHG Emissions 30.3.3 Air Quality 30.4 Conclusion and Options for the Future References 31 Do Natural Disasters Reduce Foreign Direct Investment in Sub-Saharan Africa? 31.1 Introduction 31.2 Understanding the Natural Disasters and Foreign Direct Investment Nexus 31.2.1 Natural Disasters and Its Economic Effects 31.2.2 Natural Disasters and MNCs 31.2.3 Natural Disasters and International Capital Flows 31.3 Natural Disasters and Foreign Direct Investment Trends in Sub-Saharan Africa 31.4 Model Specification 31.4.1 Data and Variables 31.4.2 Estimation Strategy 31.5 Empirical Results and Implications 31.6 Conclusion References 32 Integrating Climate Change Adaptation and Vulnerability Reduction for Sustainable Development in South Asia and Africa 32.1 Introduction 32.2 Climate-Smart Farming: Potentials and Problems 32.3 Climate-Smart Farming Practice: A Reality Check 32.4 Conclusion References 33 Assessing the Social Vulnerability to Floods in India: An Application of Superefficiency Data Envelopment Analysis and S... 33.1 Introduction 33.2 Study Area Profile 33.3 Using Data Envelopment Analysis to Construct Vulnerability Index: Identification of the Indicators 33.4 Research Design: Material and Methods 33.4.1 Output Indicators 33.4.2 Input Indicators 33.4.2.1 Mean elevation 33.4.2.2 Population density 33.4.2.3 Per capita Gross District Domestic Product 33.4.2.4 Road density 33.4.2.5 Medical density 33.4.3 Method 33.4.4 Spatial Analysis 33.4.5 Steps for Index Operationalization Process and Spatial Mapping 33.5 Results and Discussion 33.6 Summary and Conclusion References 34 Subjective Well-Being Impacts of Natural Hazards: A Review 34.1 Introduction 34.2 Psychological, Social, and Well-Being Impacts of Natural Disasters 34.3 Subjective Well-Being: Definition, Measurement, and Applications 34.4 Quantification of Subjective Well-Being Impacts: Method and Findings 34.5 Discussion 34.6 Conclusions and Directions for Future Research References 35 Economic Consequences of Slow- and Fast-Onset Natural Disasters: Empirical Evidences From India 35.1 Introduction 35.2 Slow and Fast-Onset Natural Disasters: Recent Trends 35.3 Review of Literature 35.3.1 Economic Impact of Droughts 35.3.2 Floods and Economic Growth 35.4 Data and Methodology 35.4.1 Data and Variables 35.4.2 Estimation Methodology 35.5 Results and Discussion 35.5.1 Benchmark Results 35.5.1.1 Slow-onset disasters: droughts 35.5.1.2 Fast-onset disasters: floods 35.5.2 Comparing the Growth Effects of Slow- and Fast-Onset Disasters 35.6 Summary References Index Back Cover