Why Do Some Countries Build Safer ? Economic Constraints, Disaster Learning, and the Two-Stage Housing Quality Ladder

Yasuhiro Kawasoe

No 11319, Policy Research Working Paper Series from The World Bank

Abstract: Why do some countries have more disaster-resilient housing than others, even at similar income levels? This paper addresses this question using a novel data set on housing robustness in 150 countries and proposes a "two-stage housing quality ladder" framework. The analysis reveals that the constraints on housing improvement fundamentally differ across development stages. In the first stage—eliminating fragile housing—household poverty is the binding constraint, showing strong negative associations with housing quality and nonlinear effects that diminish at extreme poverty levels. Progress depends primarily on poverty alleviation and basic governance capacity. In the second stage—achieving robust, engineered construction—household poverty becomes statistically insignificant. Instead, national income, construction-sector institutions (building codes, permit systems, and inspections), and overall institutional quality emerge as the critical determinants. The paper further demonstrates that countries learn from disaster experience, but this learning is hazard-specific and mediated by governance quality. Earthquake experience consistently drives improvements in housing resilience, particularly in well-governed countries, while storm and flood experiences show weaker direct effects but significant interactions with poverty levels. These findings carry important policy implications: disaster risk reduction investments should emphasize poverty alleviation and basic governance in low-income countries eliminating fragile housing, while middle- and high-income countries should prioritize construction-sector regulatory capacity and code enforcement systems to achieve robust engineering standards. Earthquake-prone countries benefit particularly from institutional strengthening that enables sustained learning from repeated seismic events.

Date: 2026-02-23
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