The Reallocation of District-Level Spending and Natural Disasters - Evidence from Indonesia

Skoufias, Emmanuel; Strobl, Eric Albert; Tveit, Thomas Breivik (March 2018). The Reallocation of District-Level Spending and Natural Disasters - Evidence from Indonesia (Policy Research Working Paper 8359). World Bank Group

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This paper combines district-level government spending data from Indonesia and natural disaster damage indices to analyze the extent to which districts are forced to reallocate their expenditures across categories after the incidence of floods, earthquakes, and volcanic eruptions. The results reveal that district government spending is quite sensitive to the incidence of natural disasters at the local level. In the case of floods, districts reallocate spending away from the category of general administration to sectors such as health and infrastructure. Moreover, volcanic eruptions seem to lead to less investment in durable assets both in the year of the disaster as well as the following year. Overall, these results highlight the potentially useful role of a national disaster risk financing insurance program toward maintaining a relatively stable level of district-level spending in different sectors.

Item Type:

Working Paper

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Economics

UniBE Contributor:

Strobl, Eric Albert and Tveit, Thomas Breivik

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

Series:

Policy Research Working Paper

Publisher:

World Bank Group

Language:

English

Submitter:

Dino Collalti

Date Deposited:

07 Oct 2019 13:17

Last Modified:

12 Nov 2019 15:48

BORIS DOI:

10.7892/boris.129926

URI:

https://boris.unibe.ch/id/eprint/129926

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