The growth aftermath of natural disasters

This paper provides a description of the macroeconomic aftermath of natural disasters. It traces the yearly response of gross domestic product growth - both aggregated and disaggregated into its agricultural and non-agricultural components - to four types of natural disasters - droughts, floods, earthquakes, and storms. The paper uses a methodological approach based on pooling the experiences of various countries over time. It consists of vector auto-regressions in the presence of endogenous variables and exogenous shocks (VARX), applied to a panel of cross-country and time-series data. The analysis finds heterogeneous effects on a variety of dimensions. First, the effects of natural disasters are stronger, for better or worse, on developing than on rich countries. Second, while the impact of some natural disasters can be beneficial when they are of moderate intensity, severe disasters never have positive effects. Third, not all natural disasters are alike in terms of the growth response they induce, and, perhaps surprisingly, some can entail benefits regarding economic growth. Thus, droughts have a negative effect on both agricultural and non-agricultural growth. In contrast, floods tend to have a positive effect on economic growth in both major sectors. Earthquakes have a negative effect on agricultural growth but a positive one on non-agricultural growth. Storms tend to have a negative effect on gross domestic product growth but the effect is short-lived and small. Future research should concentrate on exploring the mechanisms behind these heterogeneous impacts.Natural Disasters,Disaster Management,Hazard Risk Management,Achieving Shared Growth,Economic Conditions and Volatility

Large shocks, small shocks, and economic fluctuations: outliers in macroeconomic times series

Macroeconomics ; Time-series analysis

Threshold cointegration

Discount ; Federal funds market (United States)

The Relative Effects of Family Instability and Mother/Partner Conflict on Children’s Externalizing Behavior

A growing body of research has found support for the idea that children’s behavioral development and school performance may be influenced as much by multiple changes in family composition during childhood as by the quality and character of the families in which children reside at any given point (Cavanagh and Huston 2006; Cavanagh, Schiller, and Riegle-Crumb 2006; Fomby and Cherlin 2007; Heard 2007a; Heard 2007b; Heaton and Forste 2007; Osborne and McLanahan 2007; Wu 1996; Wu and Martinson 1993; Wu and Thomson 2001). Much of the research on instability has focused specifically on the effects for children of experiencing the repeated formation and dissolution of cohabiting and marital unions. Underlying the research on the effects of union instability is the concept that children and their parents or parent-figures form a functioning family system, and repeated disruptions to that system, caused by either the addition or departure of a parent’s partner or spouse, may lead to behaviors with potentially deleterious long-term consequences.

The Texas Manufacturing Outlook Survey: a tool for understanding the economy

Manufactures - Texas

Financial Literacy and Food Security in Extremely Vulnerable Households

Food insecurity is one of the most, if not the most, significant, nutrition-related public health issue confronted in the US. Unfortunately, we know very little about the determinants of food security except that it is not synonymous with poverty. Many households above the poverty line are food insecure; many below are not. We investigate a lack of financial literacy as a potential salient determinant of household-level food security. In light of the recent financial crisis and the burgeoning literature on financial literacy, we know that inadequate financial skills and practices are a significant problem that spans all socioeconomic groups. Using original survey data collected among food pantry clients in North Texas, we assess the causal effect of financial literacy on food security. Our results indicate a strikingly significant effect, both economically and statistically

Decreasing marginal impatience, income distribution and demand for money: Theory and evidence

This Paper develops a dynamic, theoretical model of demand for money under decreasing marginal impatience (DMI).Given certain conditions, the steady state is shown to be saddle-path stable and unique. It is shown that, under DMI, an increase in income inequality increases the aggregate demand for money. Empirical evidence supporting this hypothesis is provided in the context of the U.S. economy.