Proceedings of the 5th World Conference on Climate Change and Global Warming
Year: 2025
DOI:
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Impact of Natural Events on the Economic Vulnerability of Households in Peru
Jhonatan Vicuna, Renzo Castellares
ABSTRACT:
This paper estimates the impact of natural events on the economic vulnerability of Peruvian households using detailed information from official emergency records at the district level and household surveys. Specifically, we follow two approaches to identify affected households: one based on the incidence of natural events in their district of residence and the other on the household’s self-reported experience of a natural disaster shock. To enhance the classification of affected households, we integrate both identification approaches and propose a novel strategy to assess the impact of natural events on household welfare. Combining these two datasets, we find that natural events negatively impact household welfare, reducing per capita income and consumption by 6,4% and 3,4% respectively, and increasing the probability of falling into or remaining in poverty by 3,5 percentage points. Our findings align with previous evidence regarding the negative impact of natural events on household economic outcomes.
keywords: Economic vulnerability, household welfare, natural events, shocks