Modeling the Regional Impact of Natural Disaster and Recovery: A General Framework and an Application to Hurricane Andrew

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Abstract
Two common features of natural disasters are intense regional impact and the call immediately after the event to estimate the economic impact of recovery and reconstruction. The broad purpose of this paper is to help fill the gap in the regional science literature that addresses this issue. Initially, the impact estimation problem is presented conceptually. Using a general regional model schematic, direct disaster impacts on exogenous variables, endogenous variables, and model linkages are identified. Next, the conceptual problem is adapted for practical application. This translation has two aspects: (1) modifying the direct impacts for a specific model (common variants from the schematic are considered) and (2) estimating those impacts from available data. One component of the latter identifies primary sources of information typically available at the time of a natural disaster and indicates how secondary data may be used to complement, cross-check, and expand those data. A second component identifies areas of no information or high uncertainty and discusses treatment of that information gap in empirical analysis. A final section applies the research to the problem of estimating the impact of Hurricane Andrew on the economy of Florida.

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