Keeping in Place After the Storm-Emergency Assistance and Evictions

Bilal Islah and Ahmed Zoulati

Papers from arXiv.org

Abstract: We offer evidence that federal emergency assistance (FEMA) in the days following natural disasters mitigate evictions in comparison to similar emergency scenarios where FEMA aid is not provided. We find a 16% increase in overall evictions after hurricane natural disaster events that can be decomposed to a 36% increase for those that do not receive FEMA rental assitance and only a 11% for hurricane events that do receive FEMA aid. Furthermore, we also show that FEMA aid acts as a liquidity buffer to other forms of emergency credit, specifically we find that both transactions volumes remain stable and result in a decrease in defaults by 19% in payday loans during hurricane events in locations that do receive FEMA aid. This effect largely reverses in areas that do not receive FEMA aid, where transaction volumes drop by 12\% and default rates remain similar relative to the baseline. Overall, this suggests that the availability of emergency liquidity during natural disaster events is indeed a binding constraint with real household financial consequences, in particular through our documented channel of evictions and in usage of high-cost credit.

Date: 2025-05
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