Natural disasters and household welfare: A case study of rural Vietnam

Abstract

This study aimed to investigate the short–run effects of natural disasters on household’s welfare in rural Vietnam over the period from 2014 to 2016 by exploiting the panel regression (FEM and REM) to analyze the data from the Vietnam Household Living Standard Survey (VHLSS). The results show that natural disasters are negatively associated with household’s welfare. In particular, households in flood-affected areas and storm-affected areas have 8.8 percent and 8.65 percent lower per capita household income than the households in non-affected areas respectively. Likewise, households in flood-affected areas have 7.54 percent lower per capita household expenditure than households in non-affected areas. Similarly, storms reduce per capita household expenditure by about 4.5 percent.