Foreign Aid in the Aftermath of Large Natural Disasters

16 Pages Posted: 26 Jul 2014

See all articles by Oscar Becerra

Oscar Becerra

affiliation not provided to SSRN

Eduardo A. Cavallo

Inter-American Development Bank (IDB) - Research Department

Ilan Noy

Victoria University of Wellington

Multiple version iconThere are 2 versions of this paper

Date Written: August 2014

Abstract

This paper examines Official Development Assistance (ODA) in the aftermath of large natural disasters between 1970 and 2008. Using an event‐study approach, the paper finds that while the median increase in ODA is 18% compared with pre‐disaster flows, the typical surge is small in relation to the size of the affected economies. Moreover, aid surges typically cover only 3% of the total estimated economic damages caused by the disasters. The main determinants of post‐disaster aid surges are found to be the intensity of the event itself and the recipient country's characteristics such as the level of development, country size and the stock of foreign reserves. The paper does not find evidence that political considerations or strategic behavior on the part of donors determine the size of post‐disaster aid surges.

Suggested Citation

Becerra, Oscar and Cavallo, Eduardo A. and Noy, Ilan, Foreign Aid in the Aftermath of Large Natural Disasters (August 2014). Review of Development Economics, Vol. 18, Issue 3, pp. 445-460, 2014, Available at SSRN: https://ssrn.com/abstract=2472249 or http://dx.doi.org/10.1111/rode.12095

Oscar Becerra (Contact Author)

affiliation not provided to SSRN ( email )

Eduardo A. Cavallo

Inter-American Development Bank (IDB) - Research Department ( email )

1300 New York Ave., NW
Washington, DC 20577
United States

Ilan Noy

Victoria University of Wellington ( email )

P.O. Box 600
Wellington, 6140
New Zealand

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