Saving Lives with Indexed Disaster Funds: Evidence from Mexico

Alejandro del Valle

American Economic Journal: Economic Policy, 2024, vol. 16, issue 2, 442-79

Abstract: Developing economies are not disproportionately exposed to natural disasters, but they experience significantly more deaths. Exploiting a discontinuity in the eligibility rules for Mexico's indexed disaster fund (Fonden), I show that the accelerated reconstruction of public infrastructure can significantly mitigate the mortality impacts of disasters. Fonden's impact is concentrated in areas with medical infrastructure and among conditions responsive to basic and freely available medical care. These findings suggest that Fonden operates by restoring access to health services. I also show that Fonden is cost-effective relative to other interventions and that its benefit–cost ratio is at least 3.2.

JEL-codes: D61 H12 H54 H84 I18 O13 Q54 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (2)

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DOI: 10.1257/pol.20220066

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