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The impact of natural disasters on household income, expenditure, poverty and inequality: evidence from Vietnam

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Natural disasters are expected exacerbate poverty and inequality, but little evidence exists to support the impact at household level. This article examines the effect of natural disasters on household income, expenditure, poverty and inequality using the Vietnam Household Living Standard Survey in 2008. The effects of a natural disaster on household income and expenditure, corrected for fixed effects and potential endogeneity bias, are estimated at 6.9% and 7.1% declines in Vietnamese household per capita income and expenditure, respectively. Natural disasters demonstrably worsen expenditure poverty and inequality in Vietnam, and thus should be considered as a factor in designing poverty alleviation policies.

Keywords: D12; O12; Q54; Vietnam; disasters; hazards; inequality; natural shocks; poverty

Document Type: Research Article


Affiliations: 1: Department of Economics, Macquarie University, Sydney, Australia 2: Tasmanian School of Business and Economics, University of Tasmania, Hobart, 7001, Australia 3: National Economics University, Hanoi, Vietnam

Publication date: May 24, 2014

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