American Economic Journal:
Economic Policy
ISSN 1945-7731 (Print) | ISSN 1945-774X (Online)
The Fiscal Cost of Hurricanes: Disaster Aid versus Social Insurance
American Economic Journal: Economic Policy
vol. 9,
no. 3, August 2017
(pp. 168–98)
(Complimentary)
Abstract
Little is known about the fiscal costs of natural disasters, especially regarding social safety nets that do not specifically target extreme weather events. This paper shows that US hurricanes lead to substantial increases in non-disaster government transfers, such as unemployment insurance and public medical payments, in affected counties in the decade after a hurricane. The present value of this increase significantly exceeds that of direct disaster aid. This implies, among other things, that the fiscal costs of natural disasters have been significantly underestimated and that victims in developed countries are better insured against them than previously thought.Citation
Deryugina, Tatyana. 2017. "The Fiscal Cost of Hurricanes: Disaster Aid versus Social Insurance." American Economic Journal: Economic Policy, 9 (3): 168–98. DOI: 10.1257/pol.20140296Additional Materials
JEL Classification
- H51 National Government Expenditures and Health
- H53 National Government Expenditures and Welfare Programs
- H84 Disaster Aid
- J65 Unemployment Insurance; Severance Pay; Plant Closings
- Q54 Climate; Natural Disasters and Their Management; Global Warming
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