Saving Lives with Indexed Disaster Funds: Evidence from Mexico
American Economic Journal: Economic Policy
vol. 16,
no. 2, May 2024
(pp. 442-79)
Abstract
Developing economies are not disproportionately exposed to natural disasters, but they experience significantly more deaths. Exploiting a discontinuity in the eligibility rules for Mexico's indexed disaster fund (Fonden), I show that the accelerated reconstruction of public infrastructure can significantly mitigate the mortality impacts of disasters. Fonden's impact is concentrated in areas with medical infrastructure and among conditions responsive to basic and freely available medical care. These findings suggest that Fonden operates by restoring access to health services. I also show that Fonden is cost-effective relative to other interventions and that its benefit–cost ratio is at least 3.2.Citation
del Valle, Alejandro. 2024. "Saving Lives with Indexed Disaster Funds: Evidence from Mexico." American Economic Journal: Economic Policy, 16 (2): 442-79. DOI: 10.1257/pol.20220066Additional Materials
JEL Classification
- D61 Allocative Efficiency; Cost-Benefit Analysis
- H12 Crisis Management
- H54 National Government Expenditures and Related Policies: Infrastructures; Other Public Investment and Capital Stock
- H84 Disaster Aid
- I18 Health: Government Policy; Regulation; Public Health
- O13 Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products
- Q54 Climate; Natural Disasters and Their Management; Global Warming
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