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Managing Indirect Economic Consequences of Disaster Risk: The Case of Nepal

  • Reinhard Mechler
  • Stefan Hochrainer-Stigler
  • Kazuyoshi Nakano
Chapter
Part of the Advances in Natural and Technological Hazards Research book series (NTHR, volume 32)

Abstract

Natural disasters can exert significant economic and developmental impacts in countries that lack the economic resilience to bounce back post event. Yet, the brunt of these impacts often goes unrecorded and the information base for improving the financial and economic management of disaster risk in many instances is at best limited. Systematic disaster risk modeling can be a starting point for devising a comprehensive risk management approach. This chapter presents quantitative modeling analysis using the IIASA CATSIM framework for assessing economic natural disaster risk for the case of Nepal. We calculate country level direct disaster risk as well as the corresponding indirect effects using growth modeling and input-output analysis. We find the economic and fiscal risks posed by natural disasters in Nepal to be large and potentially long-lasting, particularly when they are triggered by earthquake risk. As well, disaster events ripple through the economy and may lead to important distributional effects. Given these results, we suggest there is a clear case for considering risk in economic and fiscal planning processes in Nepal and similar heavily disaster exposed countries.

Keywords

Fiscal and economic risks Disaster risk modeling Multi-risk assessment Extreme events Nepal 

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Copyright information

© Springer Science+Business Media Dordrecht 2013

Authors and Affiliations

  • Reinhard Mechler
    • 1
  • Stefan Hochrainer-Stigler
    • 1
  • Kazuyoshi Nakano
    • 2
  1. 1.Risk, Policy and Vulnerability (RPV) ProgramInternational Institute for Applied Systems Analysis (IIASA)LaxenburgAustria
  2. 2.Disaster Prevention Research InstituteKyoto UniversityKyotoJapan

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