Essays on Economics of Man-Made Disasters

Abstract

The severity of man-made disasters has been increasing recently and is expected to further increase with climate change. For example, the number of conflicts and their associated fatalities have risen by 105\% and 286\% since 2010, respectively. With the internet and technological advancement, disasters significantly affect individual welfare both directly and indirectly. I study how the end of a man-made disaster affects labor market outcomes over time and how disasters affect risk preferences in the long run and time use in the short run. In Chapter 1, I study the causal impact of peace on labor market outcomes using the sudden and unexpected end of the Aceh Insurgency in Indonesia in a difference-in-differences framework. In Chapter 2, the intergenerational effects of early life exposure to the Korean War on risk preferences are examined in a difference-in-differences-type model with both structural and reduced-form estimation methods. In Chapter 3, I take the 2014 $Sewol$ ferry disaster as a natural experiment to examine the causal effects of an exogenous psychological shock on time use.