Relevance of financial development and fiscal stability in dealing with disasters in Emerging Economies

2022/11/15 by Terrones, Valeria, Tol, Richard S. J.
#FOS: Economics and business #General Economics (econ.GN)

paper · doi:10.48550/arxiv.2211.08078

Abstract

Previous studies show that natural disasters decelerate economic growth, and more so in countries with lower financial development. We confirm these results with more recent data. We are the first to show that fiscal stability reduces the negative economic impact of natural disasters in poorer countries, and that catastrophe bonds have the same effect in richer countries.

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