Abstract

BARRIENTOS-MARIN, Jorge; OSPINA-VALENCIA, Sebastián  and  GIRALDO-FLOREZ, Sebastián. The economic cost of natural disasters: the case of the tsunami and nuclear emergency in Japan in 2011. Lect. Econ. [online]. 2020, n.93, pp.225-260.  Epub Apr 13, 2021. ISSN 0120-2596.  https://doi.org/10.17533/udea.le.n93ia340531.

In this paper we are interested in estimating the economic cost of the tsunami occurred in 2011 in Japan (as well as the subsequent nuclear emergency caused by the damage to the Fukushima’s reactor) and that affected the prefectures (provinces) of the northeast region (Fukushima, Itawe and Miyagui). To this goal, we perform the synthetic control methodology (MCS), by constructing “synthetic prefecture” using the prefectures that were not affected by the Tsunami. The results show that the cost of disaster in 2011 amounted to 2.5 billion yen (23.000 million US $), equivalent to 18% of GDP (sum of the sectoral GDP relevant to the economy of the three prefectures) and the positive causal effect measured between 2012 and 2014 was around 1.4 billion yen (12.800 million US $), equivalent to10% of GDP. The results of this paper are relevant due to they provide us a methodology for estimating the economic causal effect of disasters and conflicts.

Clasificación JEL: C21, G14, O11, O40, O53.

Keywords : synthetic counterfactual; nuclear; Fukushima; optimal weighting; tsunami.

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