‘Near miss’ housing market response to the 2012 northern Italy earthquake: The role of housing quality and risk perception

Marco Modica, Roberto Zoboli, Fabrizio Meroni, Vera Pessina, Thea Squarcina and Mario Locati
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Fabrizio Meroni: Istituto Nazionale di Geofisica e Vulcanologia Sezione di Milano, Italy
Vera Pessina: Istituto Nazionale di Geofisica e Vulcanologia Sezione di Milano, Italy
Thea Squarcina: Istituto Nazionale di Geofisica e Vulcanologia Sezione di Milano, Italy
Mario Locati: Istituto Nazionale di Geofisica e Vulcanologia Sezione di Milano, Italy

Urban Studies, 2021, vol. 58, issue 11, 2293-2309

Abstract: This paper examines the housing market response to the earthquake that hit northern Italy in May 2012. The available literature shows that the average price of houses decreases after a disaster because of the potential underestimation of disaster risk by households, or because of a higher risk perception in reaction to the unforeseen emergency. The physical assessment of the earthquake damage scenario provided in this paper (the so-called macro-seismic approach), combined with a difference-in-difference model with a multi-valued treatment, is able to extrapolate indirect information on the subjective perception of risk. We provide evidence that differences in costs and risk perceptions of the earthquake arise at high levels of damage. Furthermore, we also provide evidence that building characteristics, as well as the state of maintenance of houses, play a relevant role for subjective risk assessment, even though this assessment may be not related to the effective capacity of the buildings to resist earthquakes.

Keywords: diff-in-diff; earthquake risk; economics of natural disasters; housing market; risk perception; å Œé‡ å·®åˆ†; 地震风险; è‡ªç„¶ç ¾å®³ç» æµŽå­¦; ä½ æˆ¿å¸‚åœº; 风险感知 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:sae:urbstu:v:58:y:2021:i:11:p:2293-2309

DOI: 10.1177/0042098020943490

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