Date of Graduation

Spring 5-9-2014

Document Type

Thesis

Degree Name

Master of Science in International and Development Economics (MSIDEC)

Department/Program

Economics

First Advisor

Yaniv Stopnitzky

Second Advisor

Alessandra Cassar

Abstract

Natural disaster exposure can impact prosocial preferences, which indicate the level of social capital, as well as create a shift in investments from public to private goods. Both are important mechanisms to study in order to create optimal climate change adaptation policies. This study evaluates the impact of natural disaster exposure on prosocial preferences and public goods provision in the evaluated communities. The data used in this research comes from a process evaluation that was carried out in the Solomon Islands on the Rural Development Program (RDP) and a Structured Community Activity (SCA) experiment, which took place in 80 villages where 20 people in each village were given money and had to decide how much to keep or contribute towards a community good. There is no significant relationship between disaster exposure and prosocial preferences, yet exposure to a natural disaster in the past year is found to significantly decrease contribution amounts towards public goods in the SCA. A theoretical model of public goods provision is used to explain how experiencing a shock increases the private return from keeping the money, and thereby, decreases the amount contributed towards public goods.

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