Working Paper (2023-06)

Working Paper 2023-06
Assessing the Impacts of Compounded Disaster Shocks to a City Economy: Case of the City of Naga, Philippines

Ramon L. Clarete, Philip Arnold P. Tuaño, Rolly Czar Joseph T. Castillo, Cymon Kayle Lubangco, Marjorie S. Muyrong, Marlyn L. Tejada, Frances Michelle C. Nubla and Wilfredo B. Prilles, Jr.

Abstract 

The impacts of natural disasters in the national and local economy have been one of the development challenges in the Philippines. Compared to the rest of the Philippines, the Bicol Region, located in the northeastern portion of the country, is known for its several development challenges, among which includes its vulnerability to typhoon-related disasters. In Naga City, one of major cities in the region, which is situated in a valley surrounded by hills and mountains, is usually prone to flooding during periods of typhoons and heavy rains. The city therefore presents a case of a local city economy devastated by a series of typhoons in 2020. Typhoons and floods pose significant risks to the safety and well-being of communities. While previous studies examined the direct financial impacts in terms of damages in infrastructure and agricultural crops, this study focuses on estimates on loss on economic output and employment. Using the computable general equilibrium model as the empirical strategy, we simulate the economic impacts of the compounded typhoon disasters in 2020 and better understand the specific risks that different cities and regions face and develop strategies to minimize those risks.

Keywords: computable general equilibrium, typhoon disaster, Philippines, local economy