Original Research

The impact of disasters on economic growth in selected Southern Africa development community countries

Emmanuel Owusu-Sekyere, Wilfred Lunga, Selma T. Karuaihe
Jàmbá: Journal of Disaster Risk Studies | Vol 13, No 1 | a1081 | DOI: https://doi.org/10.4102/jamba.v13i1.1081 | © 2021 Emmanuel Owusu-Sekyere, Wilfred Lunga, Selma T. Karuaihe | This work is licensed under CC Attribution 4.0
Submitted: 10 December 2020 | Published: 29 October 2021

About the author(s)

Emmanuel Owusu-Sekyere, Human Sciences Research Council, Pretoria, South Africa
Wilfred Lunga, Human Sciences Research Council, Pretoria, South Africa; and, African Centre for Disaster Studies (ACDS), Potchefstroom, South Africa
Selma T. Karuaihe, Department of Agriculture Economics, Extension and Rural Development, University of Pretoria, Pretoria, South Africa


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Abstract

This research study explores the impact of disasters on economic growth in selected Southern Africa Development Community countries. Annual data from 2005 to 2019 and panel data econometric estimation techniques are used in this study. The estimation approaches used control for both pooled and individual effects, heteroscedasticity, serial correlation, moderate levels of endogeneity and cross-sectional dependence (CSD). We found that although the impact of disasters on economic growth may be negative contemporaneously, reconstruction and recovery activities if well-resourced could facilitate building back better, which could ultimately lead to positive outcomes on economic growth a year after the disaster. We further tested the hypothesis in existing literature and confirm that quality institutions, favourable financial conditions and adequate access to international markets enhance a country’s coping and adaptive capabilities to disasters, thereby reducing the country’s level of risk to disasters.

Keywords

natural hazard; disasters; dynamic panel data econometrics; economic growth; South Africa; Southern African Development Community; SADC

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