The long-run socio-economic consequences of a large disaster: The 1995 earthquake in Kobe

William du Pont IV, Yoko Okuyama, Ilan Noy and Yasuyuki Sawada

No 19264, Working Paper Series from Victoria University of Wellington, School of Economics and Finance

Abstract: We quantify the ‘permanent’ socio-economic impacts of the Great Hanshin-Awaji (Kobe) earthquake in 1995 by employing a large-scale panel data set of 1,719 wards from Japan over three decades. In order to overcome a fundamental difficulty of identifying the counterfactual, i.e., the Kobe economy without the earthquake, we adopt the synthetic control method of Abadie et al. (2010). Three important empirical patterns emerge: First, the population size and especially the average income level in Kobe have been lower than the counterfactual level without the earthquake for over fifteen years, indicating a permanent negative effect of the earthquake. Such a negative impact can be found especially in the central areas which are closer to the epicenter. Second, the surrounding areas experienced some positive permanent impacts in spite of short-run negative effects of the earthquake. Third, the furthest areas in the vicinity of Kobe seem to have been insulated from the large direct and indirect impacts of the earthquake.

Keywords: Natural disasters; Earthquakes; Kobe; Disaster impact (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (1)

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https://ir.wgtn.ac.nz/handle/123456789/19264

Related works:
Journal Article: The Long-Run Socio-Economic Consequences of a Large Disaster: The 1995 Earthquake in Kobe (2015)
Working Paper: The Long-Run Socio-Economic Consequences of a Large Disaster: The 1995 earthquake in Kobe (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:vuw:vuwecf:19264

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