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Propagation Of Positive Effects Of Post‐Disaster Policies Through Supply Chains

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  • Yuzuka Kashiwagi
  • Yasuyuki Todo

Abstract

This study evaluates the impact of “group subsidies,” a policy intervention intended to repair and reinstall damaged capital goods and facilities of small‐ and medium‐sized enterprises after the Great East Japan earthquake. Employing a propensity‐score‐matching and difference‐in‐differences approach, we find a positive effect of the subsidies on post‐disaster sales and employment of small recipient firms. We also find a positive indirect effect of group subsidies on firms in disaster‐hit prefectures that did not receive any group subsidy but were linked through supply chains with a recipient firm. Our results indicate the propagation of post‐disaster policy effects through supply chains. (JEL H20, L14, Q54)

Suggested Citation

  • Yuzuka Kashiwagi & Yasuyuki Todo, 2021. "Propagation Of Positive Effects Of Post‐Disaster Policies Through Supply Chains," Contemporary Economic Policy, Western Economic Association International, vol. 39(2), pages 348-364, April.
    • Handle: RePEc:bla:coecpo:v:39:y:2021:i:2:p:348-364
    DOI: 10.1111/coep.12510
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    References listed on IDEAS

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    1. Vasco M Carvalho & Makoto Nirei & Yukiko U Saito & Alireza Tahbaz-Salehi, 2021. "Supply Chain Disruptions: Evidence from the Great East Japan Earthquake," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(2), pages 1255-1321.
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    7. Yasuyuki Todo & Kentaro Nakajima & Petr Matous, 2015. "How Do Supply Chain Networks Affect The Resilience Of Firms To Natural Disasters? Evidence From The Great East Japan Earthquake," Journal of Regional Science, Wiley Blackwell, vol. 55(2), pages 209-229, March.
    8. Vasco M Carvalho & Makoto Nirei & Yukiko U Saito & Alireza Tahbaz-Salehi, 0. "Supply Chain Disruptions: Evidence from the Great East Japan Earthquake," The Quarterly Journal of Economics, Oxford University Press, vol. 136(2), pages 1255-1321.
    9. Hallegatte, Stephane, 2012. "Modeling the roles of heterogeneity, substitution, and inventories in the assessment of natural disaster economic costs," Policy Research Working Paper Series 6047, The World Bank.
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    Cited by:

    1. Yawen Wang & Qing Wang & Zhaopeng Xing, 2022. "Climate Disaster Losses and Foreign Exchange Reserve Dynamics: Evidence of East Asia Pacific," Sustainability, MDPI, vol. 14(21), pages 1-15, November.

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    More about this item

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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