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Title: Benefiting from Disaster?: Public and Private Responses to the Wenchuan Earthquake

Author(s): Albert Park and Sangui Wang

Publication Date: December 2016

Keyword(s): earthquake disaster poverty China

Programme Area(s): Development Economics and Public Economics

Abstract: We provide the first household survey-based evidence on the impact of the 2008 Wenchuan earthquake on the welfare of rural households. Asset and income losses were substantial, especially in seriously affected areas. Our main finding is that there was an overwhelming government response to the disaster. Subsidies provided to households in 2008 were so large that mean income per capita was 17.5% higher in 2008 than in 2007 and the poverty rate actually declined from 34% to 19%. Using distance from the epicenter as an instrument for earthquake damage, we find a strong positive statistical relationship between lost value of housing and other assets due to the earthquake and increases in income per capita and government transfers received, and much weaker responsiveness of private transfers, wage labor supply, and borrowing.

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Bibliographic Reference

Park, A and Wang, S. 2016. 'Benefiting from Disaster?: Public and Private Responses to the Wenchuan Earthquake'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=11684