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Long-term behavioral responses to man-made disasters: Insights from the Agent Orange experiment in Vietnam

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Listed:
  • Ralitza Dimova
  • Ulrike Grote
  • Arnab Basu

Abstract

Do man-made disasters induce permanent behavioral changes? While the temporary link between negative shocks and risk aversion has been analysed, the evolution of risk profiles over time in response to a negative shock remains unexplored. Using panel data from Agent Orange affected areas in Vietnam, we explore (i) whether individuals in a disaster-prone area are more risk tolerant vis-à -vis those who are unaffected, (ii) whether risk tolerance declines and the willingness to invest increases, with the decreasing intensity of the harm in the disaster affected area, and (iii) what factors influence individuals’ residency within disaster affected areas. We find that individuals living within an Agent Orange affected area are relatively more risk loving but this risk tolerance decreases with the decreasing intensity of harm over time. Residency within the disaster area is influenced by the level of human capital and ownership of physical capital.

Suggested Citation

  • Ralitza Dimova & Ulrike Grote & Arnab Basu, 2022. "Long-term behavioral responses to man-made disasters: Insights from the Agent Orange experiment in Vietnam," TVSEP Working Papers wp-024, Leibniz Universitaet Hannover, Institute for Environmental Economics and World Trade, Project TVSEP.
    • Handle: RePEc:tvs:wpaper:wp-024
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    References listed on IDEAS

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    More about this item

    Keywords

    Vietnam; Agent Orange; Risk Profiles; Propensity Score Matching;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D1 - Microeconomics - - Household Behavior
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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