The economics of natural disasters : a closer look at the inequalities between countries

Abstract

The wrath of Mother Nature is by no means new, but the understanding of its economic implications is still in its early stages. Natural disasters have grown in numbers over the past 30 years all over the world. Contrasting findings prevail concerning their impact; while a negative devastating effect on the nation is a result to be expected, other evidences tie these calamities to some type of beneficial destruction. This thesis discusses the nature of the outcomes and their determinants, differentiating between the short and the long run effects. A comparison between countries with different levels of development and their post-disaster situation, along with an analysis of theoretical perspectives and empirical evidences, will lead to an understanding on the potential resulting spillovers between industrialized and developing countries.