29 results for Noy, Ilan, Scholarly text

  • Household vulnerability on the frontline of climate change: The Pacific atoll nation of Tuvalu

    Taupo, Tauisi; Cuffe, Harold; Noy, Ilan (2016)

    Scholarly text
    Victoria University of Wellington

    This paper investigates the vulnerability of households to climatic disasters in the low-lying atoll nation of Tuvalu. Small Island Developing States, particularly the atoll islands, are considered to be the most vulnerable to climatic change, and in particular to sea-level rise and its associated risks. We construct poverty and hardship profiles for households on the different islands of Tuvalu, and combine these with geographic and topographic information to assess the exposure differentials among different groups using spatial econometric models. Besides the observation that poor households are more vulnerable to negative shocks because they lack the resources to respond, we also find that they are also more likely to reside in highly exposed areas to disasters (closer to the coasts and at lower elevation) and have less ability to migrate (between and within the islands).

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  • Regional Effects of Natural Disasters in China

    Vu, Tam Bang; Noy, Ilan (2013)

    Scholarly text
    Victoria University of Wellington

    We examine the effects of natural disasters on income and investment in China. Using detailed macroeconomic province-level data and their history of disaster exposure over the past two decades, and after accounting for two-way causality using a three-stage least-squares estimation procedure, we describe the relationship between disaster mortality and morbidity, disasters’ economic damages, government investment and regional economic activity and infrastructure development. The Chinese government’s aggressive investment in post-disaster reconstruction is discussed, and the implications of this investment for post-disaster private sector economic activity are analyzed empirically. We further investigate the differential effects of natural disasters on economic activity in the different provinces.

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  • Where is the money? Post-disaster foreign aid flows

    Becerra, Oscar; Cavallo, Eduardo; Noy, Ilan (2013)

    Scholarly text
    Victoria University of Wellington

    We describe the flows of aid after large catastrophic natural disasters by using the extensive record of bilateral aid flows, by aid sector, available through the OECD’s Development Assistance Committee. For each large donor, we identify the extent of cross-sector re-allocation that is occurring in the aftermath of large disasters whereby humanitarian aid increases but other types of aid may decrease. Our evidence suggests that the expectation of large surges in post disaster aid flows is not warranted given the past diversity of experience of global foreign aid by donor and by event. We find no evidence, however, that donors reallocate aid between recipient countries (cross-recipient reallocation). These observations suggest that countries which are predicted to face increasing losses from natural disasters in the coming decades (and almost all are) should be devoting significant resources for prevention, insurance, and mitigation.

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  • The short-run nationwide Macroeconomic effects of the Canterbury earthquakes

    Doyle, Lisa; Noy, Ilan (2013)

    Scholarly text
    Victoria University of Wellington

    We examine the short-run impact of the Canterbury earthquakes (4/9/2010, and 22/2/2011) on the New Zealand economy using VAR macro-models. Maybe surprisingly, we find little evidence of a pronounced impact on the aggregate economy. Our results suggest that the earthquakes reduced CPI inflation moderately, and the first earthquake had a small but short-lived, adverse effect on real gross domestic product (GDP) growth. At the very worse, it appears that policies (by the government and the Reserve Bank) have been successful in mitigating any serious adverse impact. The more significant impact of the earthquakes is to be found at the regional level.

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  • Natural disasters and firms in Vietnam

    Vu, Tam Bang; Noy, Ilan (2013)

    Scholarly text
    Victoria University of Wellington

    This paper investigates the consequences of natural disasters on firms in Vietnam over the period 2000 to 2008. We examine the impacts of natural disasters on firm investment and retail sales. We find evidence of adverse effects of disasters on retail sales accompanied by an increase in firm investment of very similar magnitude. There are important differences across geographical units, with the positive impact on investment unique to large cities and provinces with large urban concentrations. We find that more remote rural areas, especially in the North, experience declines in sales without the mitigating boost to investment in disasters’ aftermath. We also show that the decline in sales is not apparently associated with declines in household incomes.

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  • A non-monetary global measure of the direct impact of natural disasters

    Noy, Ilan (2015)

    Scholarly text
    Victoria University of Wellington

    The standard way in which disaster damages are measured involves examining separately the number of fatalities, of injuries, of people otherwise affected, and the financial damage that natural disasters cause. Here, we propose a novel way to aggregate measures of disaster impact, which aims to overcome many of the difficulties previously identified in the literature. This new index is similar, but conceptually different, from the World Health Organization’s calculation of Disability Adjusted Life Years (DALYs) lost from the burden of diseases and injuries (WHO, 2013). We convert all measures of impact into “lifeyears” units. After analyzing worldwide trends in lifeyears lost to disasters, we conclude with a very preliminary assessment of the likely impact, in lost lifeyears, of the current Ebola epidemic in the three most affected countries in West Africa.

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  • Comparing the direct human impact of natural disasters for two (surprisingly similar) cases — the Christchurch earthquake and Bangkok flood of 2011

    Noy, Ilan (2015)

    Scholarly text
    Victoria University of Wellington

    The standard way in which disaster damages are measured involves examining separately the number of fatalities, of injuries, of people otherwise affected, and the financial damage that natural disasters cause. Here, we implement a novel way to aggregate these separate measures of disaster impact and apply it to two recent catastrophic events: the Christchurch (New Zealand) earthquakes and the Greater Bangkok (Thailand) floods of 2011. This new measure, which is similar to the World Health Organization’s calculation of Disability Adjusted Life Years (DALYs) lost from the burden of diseases and injuries, is described in detail in Noy (2014). It allows us to conclude that New Zealand lost 180 thousand lifeyears as a result of the 2011 events, and Thailand lost 2,644 thousand years. In per capita terms, the loss is similar, with both countries losing about 15 days per person due to the 2011 catastrophic events in these two countries. We also compare these events to other potentially similar events.

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  • The (mis) allocation of public spending in a low income country: Evidence from disaster risk reduction spending in Bangladesh

    Karim, Azreen; Noy, Ilan (2015)

    Scholarly text
    Victoria University of Wellington

    Rational allocation of limited public resources is critical to achieve the stated aims of government programmes. Here, we focus on the regional allocation of public spending for disaster risk reduction in Bangladesh as a case study to identify the rationale that guides public funding allocations. It is well understood that any government’s public spending decision-making is also affected by considerations other than need, and our objective in this paper is to identify all of the directly observable determinants’ of publicly allocated and realized spending at the local government (sub-district) level. We employ the Heckman two-stage selection model with detailed public finance and other data from 483 sub-districts (upazilas) across the country. While some of our results conform with our priors, our estimations surprisingly find that government does not respond to the sub-district’s risk exposure as a factor affecting the DRR financing mechanism. This variable is consistently counter-intuitively negative and statistically significant. The DRR regional allocations do not seem to be determined by risk and exposure, only weakly by vulnerability, nor even by more transparent political economy motivations. This is surprising, as the Bangladesh DRR program is considered a poster-child of DRR investments.

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  • Natural disasters and climate change in the Pacific island countries: New non-monetary measurements of impacts

    Noy, Ilan (2015)

    Scholarly text
    Victoria University of Wellington

    We tabulate and measure the burden of disasters on the Pacific Island Countries (PICs) by aggregating and comparing the data found in the two global datasets on disaster impacts. We show that the most commonly used dataset greatly underestimates the burden of disasters for the Pacific islands. Next, we describe a new index that aggregates disaster impacts, calculate this index for the PICs, and then compare the burden of disasters for the island countries of the Pacific with the island countries of the Caribbean. This comparison demonstrates quite clearly that the burden of disasters is significantly more acute in the Pacific. Lastly, we discuss the evidence regarding the future impact of climatic change in the Pacific on the region’s disaster burden. The Pacific is facing a very high degree of disaster risk, and that is only predicted to increase in the future. On the other hand, the region has a small population, and given the global resources available for disaster risk reduction, it can easily be seen as the frontier where attempts to create a more sustainable and resilient future can be put to their first tests. *

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  • Precautionary strategies and household savings

    Aizenman, Joshua; Cavallo, Eduardo; Noy, Ilan (2015)

    Scholarly text
    Victoria University of Wellington

    Why do people save? A strand of the literature has emphasized the role of ‘precautionary’ motives; i.e., private agents save in order to mitigate unexpected future income shocks. An implication is that in countries faced with more macroeconomic volatility and risk, private saving should be higher. From the observable data, however, we find a negative correlation between risk and private saving in cross-country comparisons, particularly in developing countries. We provide a plausible explanation for the disconnect between precautionary-saving theory and the empirical evidence that is based on a model with a richer account for the various modes of ‘precautionary’ behavior by private agents, in cases where institutions are weaker and labor informality is prevalent. In such environments, household saving decisions are intertwined with firms’ investment decisions. As a result, the interaction between saving behavior, broadly construed, and aggregate risk and uncertainty, may be more complex than is frequently assumed.

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

    du Pont IV, William; Okuyama, Yoko; Noy, Ilan; Sawada, Yasuyuki (2015)

    Scholarly text
    Victoria University of Wellington

    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.

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  • Modelling New Zealand milk: From the farm to the factory

    Welsh, Melissa; Marshall, Sarah; Noy, Ilan (2016)

    Scholarly text
    Victoria University of Wellington

    Dairy products have long been an important dietary component, particularly for young children. Because of this the dairy industry is especially sensitive to contamination scares, and dairy is of particular importance to the New Zealand economy. This paper develops a Markov chain model for the early stages of the dairy supply-chain. Using the case of a major New Zealand Dairy company, simulations are run under various product-testing scenarios. Results point to the importance of where and when testing and interventions take place. Being strict about removing potentially contaminated product early on in the supply chain can reduce total losses and improve overall production output.

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  • Sri Lankan households a decade after the Indian Ocean tsunami

    De Alwis, Diana; Noy, Ilan (2016)

    Scholarly text
    Victoria University of Wellington

    We estimate the causal effect of the Indian Ocean tsunami in Sri Lanka on household income and consumption eight years after the event, using a quasi-experimental method. A strong association between area-wide tsunami disaster shock and increases in household income and consumption in the long-term emerged from our empirical investigation. Deviating from the common observation on short-term impacts, these results are suggestive of an optimistic potential for some long-lasting potentially successful recovery scenarios. Still, Sri Lanka received a very large amount of external transfers post-tsunami, much larger than is typical for disaster events and one which may not be replicable in other cases. Our findings suggest a more nuanced picture with respect to household consumption impacts. We observe a reduction of food consumption and only find an increase in non-food consumption. The increase in non-food consumption is much smaller than the observed increase in income. We also find that households in high-income regions experienced much better recovery from the disaster.

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  • Floods and spillovers: Households after the 2011 great flood in Thailand

    Noy, Ilan; Patel, Pooja (2014)

    Scholarly text
    Victoria University of Wellington

    In 2011, Thailand experienced its worst flooding in decades; it caused widespread damages, and a considerable loss of life. Using data from the Thai Household Socio-Economic Survey (THSES), this paper analyses its economic impacts. In the 2012 THSES, households answered a set of questions on the extent of flooding they experienced in the 12 months prior. As the same households are followed over time, the timing of the survey and its panel structure allows us to analyse household welfare before and after the flood, for both affected households and for those who were not directly flooded. We can thus measure the true impact of the disaster on income, expenditure, assets, debt and savings levels as well as labour market outcomes. We analyse flood impacts across different socio-economic groups and livelihoods, and identify spillover effects on those households that were not directly affected by the flooding.

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  • A survey of the theory and measurement of economic vulnerability and resilience to natural hazards

    Noy, Ilan; Yonson, Rio (2016)

    Scholarly text
    Victoria University of Wellington

    About four decades ago, the discourse on disasters was largely about natural hazards and their characteristics. The failure of this approach to substantially explain disaster impacts led to a change in paradigm. This new paradigm places its emphasis on the influence of vulnerability and resilience on the resulting impacts of disaster– be they direct or indirect. Disasters triggered by natural hazards have since been perceived as un-natural occurrences brought about by a confluence of societal factors. Economic vulnerability and economic resilience, interacting with the hazard itself and the exposure of populations and economic systems, are considered critical determinants of the resulting disaster impacts. The theoretical conceptualization and empirical measures of vulnerability and resilience, however, remain subjects of contentions. An apparently dominant view is that while vulnerability and resilience have similar underlying factors, they refer to different things. For instance, economic vulnerability and economic resilience are both shaped by the level of development, quality of development governance, and characteristics of development (widespread inequality, rapid and unplanned urbanization, etc.), yet vulnerability is considered a pre-disaster concern, while resilience, a post-disaster issue. Here, vulnerability is taken as that component of disaster risk that explains the varying impacts on elements (people, assets, systems) that have the same level of exposure to a given hazard. Resilience is what enables the exposed elements to withstand, cope and recover from disaster impacts. Thus, in terms of disaster risk reduction priorities, vulnerability is typically linked to prevention, preparedness, and mitigation; while resilience, to rehabilitation, reconstruction, and recovery. The intensified application of economic theory resulted in important advances in concretizing the concepts of economic vulnerability and resilience, as well as in measuring them. Overall, the ultimate aim for these is for a sound and widely-accepted set of concepts and measures that can be easily adjusted for practical application in different contexts (e.g. developed and developing countries), levels of assessment and governance (e.g. macro and micro; community, city, province, country), hazard types (e.g. meteorological and geologic), and elements at risk.

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  • The long-term consequences of natural disasters — A summary of the literature

    Noy, Ilan; duPont IV, William (2016)

    Scholarly text
    Victoria University of Wellington

    The long-term economic impact of natural disasters is a subject that is highly debated among scholars. Several factors should be taken into consideration: These include the type and severity of natural disaster, the underlying wealth of the economy, and the total area of country impacted. Additionally, the way that researchers choose to define long-term impact, look at direct and indirect damage, and the availability of data also matters. Regardless of the method used there is still not a clear consensus concerning the long-term economic consequences of disasters. To discuss the long-term economic impact of natural disasters, one must first define impact. A common way to determine this impact is to compare the economy post disaster to the level it was at prior to the disaster. Some researchers argue that an economy has recovered when it returns to pre-disaster levels. This approach can be useful when comparing the impact in the short-term; however when analyzing the long-term impact it becomes problematic. Economies are constantly changing, and over long periods of time these changes will accumulate. Therefore one of the biggest challenges for researchers is to estimate what the level the economy would be at had the natural disaster not occurred. The way in which researchers go about doing this, can have a large impact on the results they find. Researchers have not reached consensus concerning the long-term consequences to natural disasters. Several authors have found very little to no impact, of natural disasters in the long-term, especially when using country level data. There have been some notable exceptions. Poor countries as well as small island nations have been found to be less resilient in the long-term. Studies using data collected at regional and local, have found a much more nuanced set of results regardless of wealth, income, or size.

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  • Public and private saving and the long shadow of macroeconomic shocks

    Aizenman, Joshua; Noy, Ilan (2013)

    Scholarly text
    Victoria University of Wellington

    The global crisis of 2008-9 and the ongoing Euro crisis raise many questions regarding the long-term response to crises. We know that households that lost access to credit, for example, were forced to adjust and increase saving. But, will households remain bigger savers than they would have been had the global financial crisis not occurred? And for how long will this increased saving persist? We also ask similar questions about the public sector’s saving decisions. We study the degree to which past income crises increase the saving rates of affected households and the public sector. We find evidence consistent with history-dependent dynamics: more experience of past crises tends to increase savings among households, but lead to decreased public sector saving. This decrease in public saving, however, is about 1/3 in magnitude than the corresponding increase in private/household saving. We follow up on these findings with an investigation of the importance of historical exposure for current account dynamics, but find no strong indication that our measure of past exposure is important to the current account’s determination. We conclude by examining the likely impact of the 2008-9 GFC on future saving.

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  • Poverty, inequality and natural disasters – A survey

    Noy, Ilan; Karim, Azreen (2013)

    Scholarly text
    Victoria University of Wellington

    The last few years have seen an explosion of economic research on the consequences of natural disasters. This new interest is attributable first and foremost to a growing awareness of the potentially catastrophic nature of these events, but also a result of the increasing awareness that natural disasters are social and economic events: their impact is shaped as much by the structure and characteristics of the countries they hit as by their physical characteristics. Here, we survey the literature that examines the direct and indirect impact of natural disaster events specifically on the poor and their impact on the distribution of income within affected communities and societies. We also discuss some of the lacunae in this literature and outline a future agenda of investigation.

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  • The trade impacts of a food scare: The Fonterra contamination incident

    Stojkov, Katarina; Noy, Ilan; Sağlam, Yiğit (2016)

    Scholarly text
    Victoria University of Wellington

    This paper presents the results of an investigation into the economic implications for New Zealand of the 2013 Whey Protein Concentrate contamination incident. It assesses the impact of this incident on dairy exports using synthetic control methods. A synthetic counterfactual scenario where the incident did not occur is developed using weighted information from other countries unaffected by the scare. We find that there was an initial negative shock to the exports of products that were thought to have been contaminated, but that there were no significant sustained impacts on other dairy products. The affected products made up only a small proportion of New Zealand dairy exports, with the vast majority of dairy exports being unaffected. Infant formula exports appear to have recovered somewhat in the more than a year after the scare, however whey product exports (the contaminated product) remain lower than they otherwise would have been.

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  • Poverty and natural disasters: A meta-analysis

    Karim, Azreen; Noy, Ilan (2014)

    Scholarly text
    Victoria University of Wellington

    We conduct a meta-regression analysis of the existing literature on the impacts of disasters on households, focusing on the poor and on poverty measures. We find much heterogeneity in these impacts, but several general patterns, often observed in individual case-studies, emerge. Incomes are clearly impacted adversely, with the impact observed specifically in per-capita measures (so it is not due to the mortality caused by the observed disaster). Consumption is also reduced, but to a lesser extent than incomes. Importantly, poor households appear to smooth their food consumption by reducing the consumption of non-food items; the most significant items in this category are spending on housing, health, and education. This suggests potentially long-term adverse consequences as consumption of these services is often better viewed as long-term investment. We do not find consistent patterns in long-term impacts; it appears the limits of the meta-regression methodology prevent us from observing patterns in the relatively few heterogeneous research projects that examine these long-term effects. The importance of addressing risk within the context of sustainable development and poverty alleviation is clear. The impact of disasters on the poor may be increasingly worrying considering the climate variations we anticipate.

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