The Relationship between Economic Growth and Disaster Losses-Based on Linear and Nonlinear ARDL Model in China

Abstract

China is a country with one of the most disaster losses in the world. In this paper, a comprehensive evaluation of disaster losses in China was carried out based on the TOPSIS model of entropy weight. Then, linear and nonlinear models were established, and the relationship between economic growth and disaster losses was analyzed using the ARDL model, which included energy consumption and fixed asset investments. The results showed a significant inverted U-shaped relationship between disaster losses and economic growth; that is, smaller disaster losses helped increase economic growth, but larger disaster losses inhibited economic growth. In the long run, the increase in fossil energy consumption and new energy consumption promoted economic growth, but the role of fossil energy was more significant than that of new energy. We also found that fixed asset investment had a negative effect on economic growth.