Disaster and Decentralization

Abstract

The role of decentralized government in disaster management is well recognized among international donors and policy makers. However, there has been no rigorous attempt to address this issue. This paper studies the effect of fiscal and political decentralization on the death toll and the number of people affected by disasters for up to 46 developing and transitional economies from 1974 to 2004. The results are found to be significant and robust only at the lowest tier of government (e.g. Municipality). Elected government at the lowest level is found to increase the number of death and affected people while at the state level the effect is not significant. The effect of fiscal decentralization alone is negative, though the results are mostly insignificant. However, when fiscal decentralization is accompanied by political decentralization, it significantly reduces the number of total dead and affected people for the lowest tier of the government. Fiscal responsibility makes elected government more responsive to the needs of the vulnerable people.