The Impact of Disasters on International Trade

WTO Staff Working Paper No. ERSD-2006-04

26 Pages Posted: 6 Apr 2006

See all articles by Martin Gassebner

Martin Gassebner

ETH Zurich - KOF Swiss Economic Institute; CESifo (Center for Economic Studies and Ifo Institute)

Alexander Keck

World Trade Organization (WTO)

Robert Teh

World Trade Organization (WTO)

Date Written: March 2006

Abstract

In this paper we examine the impact of major disasters on international trade flows using a gravity model. Our panel data consists of more than 170 countries for the years 1962-2004 yielding approximately 300,000 observations. We find that the driving forces determining the impact of such events are the democracy level and, to a lesser extent, the area of the affected country. The less democratic and the smaller a country the more are its trade flows reduced in case it is struck by a disaster. We are also able to distinguish between the effect of a disaster on an importing and an exporting country.

Keywords: International trade, disasters, gravity model, governance

JEL Classification: F14, P52, P48, C23

Suggested Citation

Gassebner, Martin and Keck, Alexander and Teh, Robert, The Impact of Disasters on International Trade (March 2006). WTO Staff Working Paper No. ERSD-2006-04. Available at SSRN: https://ssrn.com/abstract=895246 or http://dx.doi.org/10.2139/ssrn.895246

Martin Gassebner (Contact Author)

ETH Zurich - KOF Swiss Economic Institute ( email )

Weinbergstrasse 35
Zurich, 8092
Switzerland

HOME PAGE: http://www.kof.ethz.ch/chair/

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Alexander Keck

World Trade Organization (WTO) ( email )

154 Rue de Lausanne
CH-1211 Geneva 21
Switzerland

Robert Teh

World Trade Organization (WTO) ( email )

154 Rue de Lausanne
CH-1211 Geneva 21
Switzerland

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