Impact assessment and a fiscal recovery policy for tsunami risk: GIS and the general equilibrium approach in Hakodate city, Japan

Hajime Tanaka and Michael Huang

Environment and Planning B, 2021, vol. 48, issue 5, 1144-1160

Abstract: Given Japan’s substantial exposure to many kinds of natural hazards, such as earthquakes, tsunamis, and typhoons, it has been a priority to invest in resilience, guided by evidence-based modeling. In 2011, the Great East Japan Earthquake and Tsunami became the costliest natural disaster ever recorded. This study applied a geographic information system using assumed tsunami-affected data calibrated in a recursive computable general equilibrium model to perform an economic impact assessment and an estimated recovery budget. We simulated 100 years of tsunamis and a 10-year sectoral recovery package for the sectors related to the ocean economy, such as kelp, net fishery, squid, other fisheries, food processing, and recreation, with a capital-use subsidy policy regarding investment strategy. We found that the aqua sector is incredibly vulnerable and would not recover with the capital-use subsidy within Hakodate City’s financial capability. Nevertheless, the recovery policy could still ease output price changes. On the other hand, the recreation sector could recover to pre-disaster conditions, but at huge fiscal and social costs. Meanwhile, the food processing sector’s recovery could generate social benefits and have a spillover effect on other fisheries sectors. The application of geographic information system in tsunami-prone areas could strengthen the precision of economic analysis. Such evidence-based modeling could visualize the economic impact to assist policymakers and stakeholders in foreseeing disaster risk and implementing more effective building resilience measures.

Keywords: Geographic information system; hazard map; Japan; tsunami disaster; recursive computable general equilibrium (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:sae:envirb:v:48:y:2021:i:5:p:1144-1160

DOI: 10.1177/2399808320977865

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