What Happened to Kobe? A Reassessment of the Impact of the 1995 Earthquake in Japan

William DuPont () and Ilan Noy
Additional contact information
William DuPont: Department of Economics, University of Hawaii at Manoa

No 201204, Working Papers from University of Hawaii at Manoa, Department of Economics

Abstract: The received wisdom is that the devastation wrought by the 1995 Kobe earthquake did not have any long-term impact on the Japanese economy, nor much impact on Kobe itself. We re-evaluate the evidence using a new methodology, synthetic control, and find a persistent and still continuing adverse impact of the quake on the economy of Kobe more than 15 years after the event. Using the methodology developed by Abadie et al. (2010), we construct counter-factual dynamics for the Kobe economy. We identify a decline in per capita GDP that is attributable to the quake and is persistent, long-term, and clearly observable even 15 years after the quake. GDP per capita in 2007 was 500,000 yen per person lower (13% decrease) than it would have been had the earthquake not occurred. Importantly, this adverse long-term impact is identified in a wealthy region of a developed country, and with the backing of a deep-pocketed fiscal authority.

Keywords: Natural disaster; earthquake; Kobe; Great Hanshin; long-run impact (search for similar items in EconPapers)
JEL-codes: O11 Q54 Q56 R11 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2012-03-19
References: View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Downloads: (external link)
http://www.economics.hawaii.edu/research/workingpapers/WP_12-4.pdf First version, 2012 (application/pdf)

Related works:
Journal Article: What Happened to Kobe? A Reassessment of the Impact of the 1995 Earthquake in Japan (2015)
Working Paper: What happened to Kobe? A reassessment of the impact of the 1995 earthquake in Japan (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hai:wpaper:201204

Ordering information: This working paper can be ordered from
http://www.economics ... esearch/working.html

Access Statistics for this paper

More papers in Working Papers from University of Hawaii at Manoa, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Web Technician ().