The Effects of Natural Disasters on Long Run （自然灾害的影响）.pdf

The Effects of N atural Disasters on Long Run Growth A aron Popp ABSTRACT. This paper seeks to determine the relationship between natural disasters and long run growth. Natural disasters affect several important macroeconomic variables, most notably technology, that can increase or decrease economic growth. Recovery following disasters is important, and the institutions of a country help determine how the recovery progresses. Institutions also help determine the outcomes of some events, such as inflation, that could affect long run growth. Countries can help maximize the positive effects of natural disasters on growth by improving their response to disasters and preparing for the next disaster. I. Introduction There were earthquakes and floods of extraordinary violence, and in a single dreadful day and night all your fighting men were swallowed up by the earth, and the island of Atlantis was similarly swallowed up by the sea and vanished. [Plato, 1977, 38] Tales told through the generations of the destruction of Atlantis and Pompeii by natural disasters show that natural disasters fascinated and affected listeners throughout history. Natural disasters still play a vital role in modern life, costing countries billions of dollars in damage and killing thousands annually. Most previous research on natural disasters focused on their short run effects on economies. Only one study has focused exclusively on the long run effects of natural disasters on growth, so the nature of the relationship between natural disasters and long run growth is still an open question. This paper seeks to determine the relationship between natural disasters and long run growth. The relationship is complicated. Natural di