Medium-run local economic effects of a major earthquake
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Date
2022
Journal Title
Journal ISSN
Volume Title
Publisher
OXFORD UNIV PRESS
Abstract
Existing research is inconclusive regarding the longer-term economic effects of earthquakes. We examine the medium-run impacts of the 2010 earthquake in Chile, the sixth-largest ever recorded, using value-added tax collection as a proxy for economic activity at the municipal level and a measure of local ground-shaking intensity. We find that the affected municipalities suffered a relevant and persistent drop in their economic activity of about 10%, 8-9 years after the event. We discuss the plausibility of the assumption of conditional parallel trends and show that the overall results are robust to using alternative estimation methods.
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Keywords
Earthquake, economic impact, local economies