Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/227143
Authors: 
Johar, Meliyanni
Johnston, David W.
Shields, Michael A.
Siminski, Peter
Stavrunova, Olena
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13616
Abstract: 
This paper studies how having your home damaged or destroyed by a natural disaster impacts on economic and financial outcomes. Our context is Australia, where disasters are frequent. Estimates of regression models with individual, area and time fixed-effects, applied to 10 waves of data (2009-2018), indicate that residential destruction has no average impact on employment and income, but increases financial hardship and financial risk aversion. These impacts are generally short-lived, larger for renters than home owners, and greater for smaller isolated disasters. Using a Group Fixed Effects estimator, we find that around 20% of the population have low resilience to financial shocks, and for these individuals we find a substantive increase in financial hardships. The most vulnerable are the young, single parents, those in poor health, those of lower socioeconomic status, and those with little social support. These results can help target government aid after future natural disasters to those with the greatest need.
Subjects: 
natural disasters
financial hardship
risk aversion
mental health
resilience
JEL: 
Q54
J21
I31
G50
C23
H84
Document Type: 
Working Paper

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