Yasuhide Okuyama arbeitet als Ökonom an der Universität von Kitakyushu und beschäftigt sich dort auch mit der Ökonomie von Katastrophen. Antworten zur Situation in Japan:
You were writing about the economics of natural desasters. What is typical for this?
Natural hazards, earthquake, hurricane, flooding, wild fire, etc., damage the built environment, such as buildings, houses, roads, lifelines, etc., and human lives, leading to economic damages. These are damages on capital (in a broad meaning, these imply assets for economic activities). These economic damages, in turn, lead to economic losses, business interruptions, caused by the inability to produce commodities and services due to economic damages on production facilities or due to reduced availability of intermediate inputs for production. The first case is easier to imagine (damaged facility leads to decline of production level) than the second case (reduced availability of intermediate inputs). As an example, in the 2007 Niigata earthquake, one factory producing automobile engine parts was severely damaged by the earthquake. This caused the one-week stoppage of production lines for all the Japanese automobile companies (TOYOTA, NISSAN, HONDA, MAZDA, etc,.). No factories of these automobile companies were damaged by the earthquake; however, because this particular engine part became not available, they could not assemble automobiles. This implies that they were indirectly affected by the earthquake. We call this indirect effect as higher-order effect. And, economic impact includes both economic losses directly related to physical damages caused by the event AND this higher-order effect.
We estimate economic impact for one year period after the event, because most of economic models we use (input-output model, social accounting matrix, etc.) to estimate economic impact are one year model.
Of course, there should be the long-term (longer than 10 years, for example) economic impact of natural disasters, and it has been studied to some extent, but most of research on economic impact of disasters are short-term impact for a few years.
You did research on the Kobe earthquake. How did things go on after this in the region and whle Japan in terms of economics. Do you think there is a similar situation in Tohoku region?
Kobe earthquake occurred in a very populated and dense urban area, causing significant structural damages on buildings, houses, roads, highways, railways, etc. On the other hand, based on the current information available, this 2011 Tohoku earthquake damaged mostly on many small cities on the pacific coast. There might have been sever structural damages on buildings, houses, and roads, but we might not be able to find these due to the tsunami after the earthquake, which washed away many of those cities. Also, since the Tohoku region is relatively rural area, and those coastal cities rely mostly on fisheries and agriculture (meaning their income level is relatively lower than in Kobe), their residential area were filled densely with old wooden houses, which have no way to resist against the large tsunami like this time. According to the scattered reports, some of cities appear completely destroyed (washed away by tsunami). It will be very difficult to rebuild such cities from scratch, since their economic base (agriculture, fisheries, and related food industries) requires at least few years to be restored and the community may not have sufficient financial resources to survive during that period. The Kobe’s damages and the number of casualties may be larger than in this 2011 Tohoku earthquake, but they had some industries left in tact and remaining population was much larger than in this case. So, the situation for economic recovery and reconstruction strategies for this time shall be much different from the Kobe’s case, and I guess it would be much tougher for the Tohoku region than for Kobe.
It is said that Japan was relativly well prepared for an earthquake. Do you think the loss reduction strategies worked?
A good question. The Japanese mitigation strategies focus mainly on stronger structure (resisting against ground shakes of earthquake for protecting people inside) and early warning and evacuation policy. We need more time to evaluate these with more detailed damage information. Based on the current available information, tsunami seems to have brought much severer damages than the shakes of the earthquake. If this is the case, the early warning and evacuation policy was tested in a very hard way. Whether or not it worked, we need more time to evaluate it.
Economics of Natural Disasters: A Critical Review – A Research Paper of Yasuhide Okuyama