The Economics of Natural Disasters : Concepts and Methods
Large-scale disasters regularly affect societies over the globe, causing large destruction and damage. After each of these events, media, insurance companies, and international institu-tions publish numerous assessments of the "cost of the dis...
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| Format: | Policy Research Working Paper |
| Language: | English |
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2012
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| 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_20101221155640 http://hdl.handle.net/10986/3991 |
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okr-10986-3991 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
AGRICULTURAL ECONOMICS AGRICULTURE ALLOCATION ASSETS AVALANCHES BANKRUPTCY BUSINESS CYCLES CHANGES IN PRICES CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CONSTRUCTION WORKERS CONSUMPTION LOSS COST ANALYSIS CRED DAMAGED HOUSES DAMAGES DEBT DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DEVELOPMENT POLICY DIRECT VALUE DISASTER DISASTER MANAGEMENT DISASTER PREVENTION DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECOLOGICAL ECONOMICS ECONOMETRIC ANALYSIS ECONOMETRICS ECONOMIC EQUILIBRIUM ECONOMIC GROWTH ECONOMIC GROWTH RATE ECONOMIC IMPACT ECONOMIC IMPACTS ECONOMIC IMPLICATIONS ECONOMIC LOSS ECONOMIC MODEL ECONOMIC MODELS ECONOMIC PERFORMANCE ECONOMIC PERSPECTIVE ECONOMIC RECOVERY ECONOMIC RESILIENCE ECONOMIC SECTORS ECONOMIC SITUATION ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC VALUE ECONOMICS EPIDEMIOLOGY EXOGENOUS SHOCKS EXPLOSION EXTERNAL SHOCKS EXTREME EVENTS FARMER FINANCIAL CRISES FINANCIAL IMPACTS FINANCIAL RESOURCES FINANCIAL SUPPORT FLOOD FLOOD DAMAGE FLOOD DAMAGES FLOODS FOOD SECURITY FUTURE RESEARCH GDP GENERAL EQUILIBRIUM ANALYSIS GROWTH RATE GROWTH THEORIES HEAT WAVES HURRICANE HURRICANE RISK HURRICANE SEASON HURRICANES IMPACT OF DISASTERS IMPACT OF HURRICANES IMPORTS INCOME INHERITANCE INSURANCE INSURANCE COMPANIES INSURANCE INDUSTRY INSURERS INTEREST RATE INVENTORIES JOBS LAND DEGRADATION LANDSLIDES LOWER COSTS MACROECONOMIC SHOCKS NATURAL DISASTER NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCES OIL PRICES POLITICAL ECONOMY POSITIVE EXTERNALITY PRESENT VALUE PRICE ELASTICITY PRICE INCREASE PRODUCTION FUNCTIONS PRODUCTIVITY PROPERTY VALUES RECONSTRUCTION REDISTRIBUTIVE EFFECTS REINSURANCE RELATIVE PRICE RELATIVE PRICES RISK ANALYSIS RISK ASSESSMENT RISK MANAGEMENT SAVINGS SCENARIOS SMALL BUSINESS STORM STORM SURGE STORM SURGE RISK STORMS SUBSTITUTION TERRORIST THUNDERSTORMS TOTAL COST TOTAL OUTPUT TSUNAMIS UNCERTAINTIES UNEMPLOYMENT VALUE ADDED VICTIMS VOLCANIC ERUPTIONS WAR WATER DISTRIBUTION WEATHER EXTREMES |
| spellingShingle |
AGRICULTURAL ECONOMICS AGRICULTURE ALLOCATION ASSETS AVALANCHES BANKRUPTCY BUSINESS CYCLES CHANGES IN PRICES CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CONSTRUCTION WORKERS CONSUMPTION LOSS COST ANALYSIS CRED DAMAGED HOUSES DAMAGES DEBT DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DEVELOPMENT POLICY DIRECT VALUE DISASTER DISASTER MANAGEMENT DISASTER PREVENTION DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECOLOGICAL ECONOMICS ECONOMETRIC ANALYSIS ECONOMETRICS ECONOMIC EQUILIBRIUM ECONOMIC GROWTH ECONOMIC GROWTH RATE ECONOMIC IMPACT ECONOMIC IMPACTS ECONOMIC IMPLICATIONS ECONOMIC LOSS ECONOMIC MODEL ECONOMIC MODELS ECONOMIC PERFORMANCE ECONOMIC PERSPECTIVE ECONOMIC RECOVERY ECONOMIC RESILIENCE ECONOMIC SECTORS ECONOMIC SITUATION ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC VALUE ECONOMICS EPIDEMIOLOGY EXOGENOUS SHOCKS EXPLOSION EXTERNAL SHOCKS EXTREME EVENTS FARMER FINANCIAL CRISES FINANCIAL IMPACTS FINANCIAL RESOURCES FINANCIAL SUPPORT FLOOD FLOOD DAMAGE FLOOD DAMAGES FLOODS FOOD SECURITY FUTURE RESEARCH GDP GENERAL EQUILIBRIUM ANALYSIS GROWTH RATE GROWTH THEORIES HEAT WAVES HURRICANE HURRICANE RISK HURRICANE SEASON HURRICANES IMPACT OF DISASTERS IMPACT OF HURRICANES IMPORTS INCOME INHERITANCE INSURANCE INSURANCE COMPANIES INSURANCE INDUSTRY INSURERS INTEREST RATE INVENTORIES JOBS LAND DEGRADATION LANDSLIDES LOWER COSTS MACROECONOMIC SHOCKS NATURAL DISASTER NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCES OIL PRICES POLITICAL ECONOMY POSITIVE EXTERNALITY PRESENT VALUE PRICE ELASTICITY PRICE INCREASE PRODUCTION FUNCTIONS PRODUCTIVITY PROPERTY VALUES RECONSTRUCTION REDISTRIBUTIVE EFFECTS REINSURANCE RELATIVE PRICE RELATIVE PRICES RISK ANALYSIS RISK ASSESSMENT RISK MANAGEMENT SAVINGS SCENARIOS SMALL BUSINESS STORM STORM SURGE STORM SURGE RISK STORMS SUBSTITUTION TERRORIST THUNDERSTORMS TOTAL COST TOTAL OUTPUT TSUNAMIS UNCERTAINTIES UNEMPLOYMENT VALUE ADDED VICTIMS VOLCANIC ERUPTIONS WAR WATER DISTRIBUTION WEATHER EXTREMES Hallegatte, Stephane Przyluski, Valentin The Economics of Natural Disasters : Concepts and Methods |
| geographic_facet |
The World Region The World Region |
| relation |
Policy Research working paper ; no. WPS 5507 |
| description |
Large-scale disasters regularly affect
societies over the globe, causing large destruction and
damage. After each of these events, media, insurance
companies, and international institu-tions publish numerous
assessments of the "cost of the disaster." However
these assessments are based on different methodologies and
approaches, and they often reach different results. Besides
methodological differences, these discrepancies are due to
the multi-dimensionality in disaster impacts and their large
redistributive effects, which make it unclear what is
included in the estimates. But most importantly, the purpose
of these assessments is rarely specified, although different
purposes correspond to different perimeters of analysis and
different definitions of what a cost is. To clarify this
situation, this paper proposes a definition of the cost of a
disaster, and emphasizes the most important mechanisms that
explain and determine this cost. It does so by first
explaining why the direct economic cost, that is, the value
of what has been damaged or destroyed by the disaster, is
not a sufficient indicator of disaster seriousness and why
estimating indirect losses is crucial to assess the
consequences on welfare. The paper describes the main
indirect consequences of a disaster and the following
reconstruction phase, and discusses the economic mechanisms
at play. It proposes a review of available methodologies to
assess indirect economic consequences, illustrated with
examples from the literature. Finally, it highlights the
need for a better understanding of the economics of natural
disasters and suggests a few promising areas for research on
this topic. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Hallegatte, Stephane Przyluski, Valentin |
| author_facet |
Hallegatte, Stephane Przyluski, Valentin |
| author_sort |
Hallegatte, Stephane |
| title |
The Economics of Natural Disasters : Concepts and Methods |
| title_short |
The Economics of Natural Disasters : Concepts and Methods |
| title_full |
The Economics of Natural Disasters : Concepts and Methods |
| title_fullStr |
The Economics of Natural Disasters : Concepts and Methods |
| title_full_unstemmed |
The Economics of Natural Disasters : Concepts and Methods |
| title_sort |
economics of natural disasters : concepts and methods |
| 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_20101221155640 http://hdl.handle.net/10986/3991 |
| _version_ |
1764389375769051136 |
| spelling |
okr-10986-39912021-04-23T14:02:14Z The Economics of Natural Disasters : Concepts and Methods Hallegatte, Stephane Przyluski, Valentin AGRICULTURAL ECONOMICS AGRICULTURE ALLOCATION ASSETS AVALANCHES BANKRUPTCY BUSINESS CYCLES CHANGES IN PRICES CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CONSTRUCTION WORKERS CONSUMPTION LOSS COST ANALYSIS CRED DAMAGED HOUSES DAMAGES DEBT DEVELOPMENT ECONOMICS DEVELOPMENT NETWORK DEVELOPMENT POLICY DIRECT VALUE DISASTER DISASTER MANAGEMENT DISASTER PREVENTION DROUGHT DROUGHTS EARTHQUAKE EARTHQUAKES ECOLOGICAL ECONOMICS ECONOMETRIC ANALYSIS ECONOMETRICS ECONOMIC EQUILIBRIUM ECONOMIC GROWTH ECONOMIC GROWTH RATE ECONOMIC IMPACT ECONOMIC IMPACTS ECONOMIC IMPLICATIONS ECONOMIC LOSS ECONOMIC MODEL ECONOMIC MODELS ECONOMIC PERFORMANCE ECONOMIC PERSPECTIVE ECONOMIC RECOVERY ECONOMIC RESILIENCE ECONOMIC SECTORS ECONOMIC SITUATION ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC VALUE ECONOMICS EPIDEMIOLOGY EXOGENOUS SHOCKS EXPLOSION EXTERNAL SHOCKS EXTREME EVENTS FARMER FINANCIAL CRISES FINANCIAL IMPACTS FINANCIAL RESOURCES FINANCIAL SUPPORT FLOOD FLOOD DAMAGE FLOOD DAMAGES FLOODS FOOD SECURITY FUTURE RESEARCH GDP GENERAL EQUILIBRIUM ANALYSIS GROWTH RATE GROWTH THEORIES HEAT WAVES HURRICANE HURRICANE RISK HURRICANE SEASON HURRICANES IMPACT OF DISASTERS IMPACT OF HURRICANES IMPORTS INCOME INHERITANCE INSURANCE INSURANCE COMPANIES INSURANCE INDUSTRY INSURERS INTEREST RATE INVENTORIES JOBS LAND DEGRADATION LANDSLIDES LOWER COSTS MACROECONOMIC SHOCKS NATURAL DISASTER NATURAL DISASTERS NATURAL HAZARDS NATURAL RESOURCES OIL PRICES POLITICAL ECONOMY POSITIVE EXTERNALITY PRESENT VALUE PRICE ELASTICITY PRICE INCREASE PRODUCTION FUNCTIONS PRODUCTIVITY PROPERTY VALUES RECONSTRUCTION REDISTRIBUTIVE EFFECTS REINSURANCE RELATIVE PRICE RELATIVE PRICES RISK ANALYSIS RISK ASSESSMENT RISK MANAGEMENT SAVINGS SCENARIOS SMALL BUSINESS STORM STORM SURGE STORM SURGE RISK STORMS SUBSTITUTION TERRORIST THUNDERSTORMS TOTAL COST TOTAL OUTPUT TSUNAMIS UNCERTAINTIES UNEMPLOYMENT VALUE ADDED VICTIMS VOLCANIC ERUPTIONS WAR WATER DISTRIBUTION WEATHER EXTREMES Large-scale disasters regularly affect societies over the globe, causing large destruction and damage. After each of these events, media, insurance companies, and international institu-tions publish numerous assessments of the "cost of the disaster." However these assessments are based on different methodologies and approaches, and they often reach different results. Besides methodological differences, these discrepancies are due to the multi-dimensionality in disaster impacts and their large redistributive effects, which make it unclear what is included in the estimates. But most importantly, the purpose of these assessments is rarely specified, although different purposes correspond to different perimeters of analysis and different definitions of what a cost is. To clarify this situation, this paper proposes a definition of the cost of a disaster, and emphasizes the most important mechanisms that explain and determine this cost. It does so by first explaining why the direct economic cost, that is, the value of what has been damaged or destroyed by the disaster, is not a sufficient indicator of disaster seriousness and why estimating indirect losses is crucial to assess the consequences on welfare. The paper describes the main indirect consequences of a disaster and the following reconstruction phase, and discusses the economic mechanisms at play. It proposes a review of available methodologies to assess indirect economic consequences, illustrated with examples from the literature. Finally, it highlights the need for a better understanding of the economics of natural disasters and suggests a few promising areas for research on this topic. 2012-03-19T18:43:28Z 2012-03-19T18:43:28Z 2010-12-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20101221155640 http://hdl.handle.net/10986/3991 English Policy Research working paper ; no. WPS 5507 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 |