A New Model to Evaluate the Economic Effects of Floods and its Application to China

FUDAN Journal of Humanities and Social Sciences, 9(4): 627–641

Posted: 13 Jul 2016 Last revised: 24 Nov 2016

See all articles by Mario Arturo Ruiz Estrada

Mario Arturo Ruiz Estrada

University of Malaya (UM) - Faculty of Economics & Administration (FEA)

Ibrahim Ndoma

University of Malaya (UM) - Faculty of Economics & Administration (FEA)

Donghyun Park

Nanyang Technological University (NTU); Asian Development Bank

Date Written: July 13, 2016

Abstract

We set forth the macroeconomics evaluation of floods (MEF) model, a new model to assess and evaluate the impact of floods on GNP growth. This model points to a new, more concrete approach to measure the economic impact of floods. Up to now, the measurement has been subject to a great deal of uncertainty. The main contribution of the model is to significantly reduce this uncertainty by measuring the impact with four well-defined, economically intuitive indicators. To illuminate and demonstrate its promise, we employ the model to evaluate and analyze the impact of two major floods on the economy of the People’s Republic of China. Our MEF-Model analysis indicates that the floods of Zhangshu and Jiangxi in 2010 caused greater economic damage than the floods of Central South China in 1931. Going forward, MEF-Model simulations are a valuable tool for estimating the effect of potential future floods in the PRC and elsewhere.

Keywords: Floods, economic impact, economic evaluation, MEF-model, China

JEL Classification: Q54, O40

Suggested Citation

Ruiz Estrada, Mario Arturo and Ndoma, Ibrahim and Park, Donghyun, A New Model to Evaluate the Economic Effects of Floods and its Application to China (July 13, 2016). FUDAN Journal of Humanities and Social Sciences, 9(4): 627–641. Available at SSRN: https://ssrn.com/abstract=2809052

Mario Arturo Ruiz Estrada (Contact Author)

University of Malaya (UM) - Faculty of Economics & Administration (FEA) ( email )

Kuala Lumpur, 50603
Malaysia
+60126850293 (Phone)

HOME PAGE: http://ssrc.um.edu.my/

Ibrahim Ndoma

University of Malaya (UM) - Faculty of Economics & Administration (FEA) ( email )

University of Malaya
Kuala Lumpur, Wilayah Persekutuan 50603
Malaysia

Donghyun Park

Nanyang Technological University (NTU) ( email )

S3 B2-A28 Nanyang Avenue
Singapore, 639798
Singapore

Asian Development Bank

6 ADB Avenue, Mandaluyong City 1550
Metro Manila
Philippines

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