Natural Disaster Damage Indices Based on Remotely Sensed Data: An Application to Indonesia

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

The Reallocation of District-Level Spending and Natural Disasters: Evidence from Indonesia

“…Using damage indices from Skoufias et al (2017) for floods, earthquakes, volcanic eruptions and the 2004 tsunami, this paper combines these indices with district-level expenditure data to investigate how districts might redistribute their spending depending on the type of disaster that strikes. The analysis yields evidence that redistribution is taking place across economic sectors and by category, irrespective of the disaster type, with the direction and the size of the redistribution differing with the type and strength of disaster.…”

“…The methodology and data sources used to make damage indices for natural disasters are extensively covered in Skoufias et al (2017), and there are also additional details in Appendix A. Generally, the paper uses remote sensing data for the different disaster types -floods, earthquakes, volcanic eruptions and the 2004 tsunami -that are combined with nightlight data -used as a proxy for economic activity -to construct an index that estimates the impact on districts and provinces.…”

“…This appendix provides more details from Skoufias et al (2017) on the construction and aggregation of the disaster indices in the main paper. To weight the indices, nightlight data are used as a proxy for economic activity.…”

“…To answer how disaster relief is financed, one needs a proxy for local damages. In Skoufias et al (2017), the authors have constructed damage indices for different disaster types, and this paper will see how well these can be used to identify potential district budget reallocations due to natural disasters. An added benefit of the indices is that they are constructed from freely available data, implying that they can be a cost efficient resource for identifying local economic activity.…”

“…An added benefit of the indices is that they are constructed from freely available data, implying that they can be a cost efficient resource for identifying local economic activity. The natural disaster damage indices in Skoufias et al (2017) are constructed by modeling the local strength of each disaster using its physical characteristics and taking account of local exposure to these aspects using nightlight intensity derived from satellite imagery. The disasters examined are floods, earthquakes, volcanic eruptions and the 2004 tsunami, all of which are modeled using different remote sensing data that are aggregated up to district level.…”