Allocation of post-disaster reconstruction financing to housing

The allocation of a significant portion of post-natural disaster financing to housing reconstruction in poorer countries is examined. Many poorer countries are reliant on external assistance in the form of loans or grants to meet their post-disaster reconstruction needs. Today, half of all the post-disaster borrowing provided by the World Bank is earmarked for the reconstruction of housing. Should this high proportion of limited reconstruction funds be allocated to a fundamentally private sector need? Is such an allocation economically efficient? After exploring these questions, an alternative solution is examined for government funds to be allocated to high economic return projects (e.g. infrastructure) and to meeting the needs of the poor. The allocation of funding to housing, much of which is captured by the economic and social elite, seems a misallocation of scarce resources. This is particularly the case since the funding available for post-disaster reconstruction by the international financial institutions is constrained and unable to meet anticipated future demand.

[1]  Reinhard Mechler,et al.  Disaster Loss Financing in Germany - The Case of the Elbe River Floods 2002 , 2003 .

[2]  K. Arrow,et al.  Uncertainty and the Evaluation of Public Investment Decisions , 2014 .

[3]  Emmanuel Skoufias,et al.  Economic Crises and Natural Disasters: Coping Strategies and Policy Implications , 2003 .

[4]  Kenneth A. Froot.  The Financing of Catastrophe Risk , 1999 .

[5]  Alcira Kreimer,et al.  The World Bank's Experience with Post-Conflict Reconstruction , 1998 .

[6]  J. G. Shepherd.  Being prepared , 1992, Nature.

[7]  S. K. Mayo,et al.  Housing: enabling markets to work , 1993 .

[8]  Torben Juul Andersen.  Picture This: Hit by Disaster , 2003 .

[9]  V A Chadwick.  The infrastructure of development , 1980 .

[10]  Roy Gilbert.  Doing more for those made homeless by natural disasters , 2001 .

[11]  J. Fitzgerald,et al.  Where Did All the Growth Go , 1994 .

[12]  Caroline Clarke,et al.  Facing the Challenge of Natural Disasters in Latin America and the Caribbean: An IDB Action Plan , 2000 .

[13]  Idndr,et al.  Manual for estimating the socio-economic effects of natural disasters , 1998 .

[14]  David A. Moss.  When All Else Fails: Government as the Ultimate Risk Manager , 2002 .

[15]  Phil O'Keefe,et al.  On The Emergence of Complex Disasters , 1997 .

[16]  J. St Cyr,et al.  Journal of Homeland Security and Emergency Management At Risk : Natural Hazards , People ' s Vulnerability , and Disasters , 2011 .

[17]  Roy Kreimer Alcira Gilber.  Learning from the World Bank's experience of natural disaster related assistance , 1999 .

[18]  Margaret Arnold,et al.  Managing disaster risk in Mexico : market incentives for mitigation investment , 1999 .

[19]  John Doling.  Comparative Housing Policy: Government and Housing in Advanced Industrialized Countries , 1997 .

[20]  B. Wisner,et al.  At Risk: Natural Hazards, People's Vulnerability and Disasters , 1996 .

[21]  Paul K. Freeman.  Natural Hazard Risk and Privatization , 2002 .

[22]  J. Albala-Bertrand,et al.  Political Economy of Large Natural Disasters: With Special Reference to Developing Countries , 1993 .

[23]  Reinhard Mechler,et al.  Natural disaster risk and cost-benefit analysis , 2003 .

[24]  Ian B. Fox,et al.  Floods and the poor : reducing the vulnerability of the poor to the negative impacts of floods , 2004 .

[25]  P. Freeman,et al.  Hedging Natural Catastrophe Risk in Developing Countries , 2001 .

[26]  R. Holzmann,et al.  Social Protection Discussion Paper Series Social Risk Management : A New Conceptual Framework for Social Protection and Beyond , 2000 .

[27]  Charlotte Benson,et al.  Developing countries and the economic impacts of natural disasters , 2000 .

[28]  D. Rodrik.  Where Did All the Growth Go? External Shocks, Social Conflict, and Growth Collapses , 1998 .

[29]  John Doling,et al.  Comparative Housing Policy , 1997 .