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Article

ASEAN countries are frequently hit by a variety of natural disasters, and a large fraction of economic activity in ASEAN countries is located in areas exposed to these natural perils. Increasing disaster damages require ASEA countries to manage the financial losses in a more efficient and proactive manner. Currently, most risk-transfer mechanisms in this region rely on ad-hoc government relief, which is not sustainable. Multilateral cooperation in the areas of risk-modeling and mapping as well as joint efforts to establish financial risk-transfer solutions could help to overcome existing challenges in this area.

Article

Dewald van Niekerk and Livhuwani David Nemakonde

The sub-Saharan Africa (SSA) region, along with the rest of the African continent, is prone to a wide variety of natural hazards. Most of these hazards and the associated disasters are relatively silent and insidious, encroaching on life and livelihoods, increasing social, economic, and environmental vulnerability even to moderate events. With the majority of SSA’s disasters being of hydrometeorological origin, climate change through an increase in the frequency and magnitude of extreme weather events is likely to exacerbate the situation. Whereas a number of countries in SSA face significant governance challenges to effectively respond to disasters and manage risk reduction measures, considerable progress has been made since the early 2000s in terms of policies, strategies, and/or institutional mechanisms to advance disaster risk reduction and disaster risk management. As such, most countries in SSA have developed/reviewed policies, strategies, and plans and put in place institutions with dedicated staffs and resources for natural hazard management. However, the lack of financial backing, limited skills, lack of coordination among sectors, weak political leadership, inadequate communication, and shallow natural hazard risk assessment, hinders effective natural hazard management in SSA. The focus here is on the governance of natural hazards in the sub-Saharan Africa region, and an outline of SSA’s natural hazard profile is presented. Climate change is increasing the frequency and magnitude of extreme weather events, thus influencing the occurrence of natural hazards in this region. Also emphasized are good practices in natural hazard governance, and SSA’s success stories are described. Finally, recommendations on governance arrangements for effective implementation of disaster risk reduction initiatives and measures are provided.

Article

Daniel P. Aldrich, Michelle A. Meyer, and Courtney M. Page-Tan

The impact of disasters continues to grow in the early 21st century, as extreme weather events become more frequent and population density in vulnerable coastal and inland cities increases. Against this backdrop of risk, decision-makers persist in focusing primarily on structural measures to reduce losses centered on physical infrastructure such as berms, seawalls, retrofitted buildings, and levees. Yet a growing body of research emphasizes that strengthening social infrastructure, not just physical infrastructure, serves as a cost-effective way to improve the ability of communities to withstand and rebound from disasters. Three distinct kinds of social connections, including bonding, bridging, and linking social ties, support resilience through increasing the provision of emergency information, mutual aid, and collective action within communities to address natural hazards before, during, and after disaster events. Investing in social capital fosters community resilience that transcends natural hazards and positively affects collective governance and community health. Social capital has a long history in social science research and scholarship, particularly in how it has grown within various disciplines. Broadly, the term describes how social ties generate norms of reciprocity and trust, allow collective action, build solidarity, and foster information and resource flows among people. From education to crime, social capital has been shown to have positive impacts on individual and community outcomes, and research in natural hazards has similarly shown positive outcomes for individual and community resilience. Social capital also can foster negative outcomes, including exclusionary practices, corruption, and increased inequality. Understanding which types of social capital are most useful for increasing resilience is important to move the natural hazards field forward. Many questions about social capital and natural hazards remain, at best, partially answered. Do different types of social capital matter at different stages of disaster—e.g., mitigation, preparedness, response, and recovery? How do social capital’s effects vary across cultural contexts and stratified groups? What measures of social capital are available to practitioners and scholars? What actions are available to decision-makers seeking to invest in the social infrastructure of communities vulnerable to natural hazards? Which programs and interventions have shown merit through field tests? What outcomes can decision-makers anticipate with these investments? Where can scholars find data sets on resilience and social capital? The current state of knowledge about social capital in disaster resilience provides guidance about supporting communities toward more resilience.

Article

Timothy Sim and Jun Lei Yu

China is a vast country frequently impacted by multiple natural hazards. All natural disasters have been reported in China, except volcanic eruptions. Almost every region in China is threatened by at least one type of natural hazard, and the rural areas are most vulnerable, with fewer resources and less developed disaster protective measures as well as lower levels of preparedness. In the first 30 years since its establishment in 1949, the Chinese government, hindered by resource constraints, encouraged local communities to be responsible for disaster response. As the country’s economy grew exponentially, after it opened its doors to the world in the late 1970s, China’s natural hazard governance (NHG) system quickly became more top-down, with the government leading the way for planning, coordinating, directing, and allocating resources for natural disasters. The development of China’s NHG is linked to the evolution of its ideologies, legislation system, and organizational structures for disaster management. Ancient China’s disaster management was undergirded by the ideology that one accepted one’s fate passively in the event of a disaster. In contemporary China, three ideologies guide the NHG: (a) passive disaster relief characterized by “help oneself by engaging in production”; (b) active disaster management characterized by “emergency management”; and (c) optimized disaster risk governance characterized by “multiple stakeholders working together.” Meanwhile, the NHG legislation and systems have become more open, transparent, and integrated one over time. Evidenced by the unprecedented growth of social organizations and private companies that engaged in disaster-related activities during and after the 2008 Wenchuan earthquake, discussions on integrating bottom-up capacities with the top-down system have increased recently. The Chinese government started purchasing services from social organizations and engaging them in building disaster model communities (officially known as “Comprehensive Disaster Reduction Demonstration Communities”) in recent years. These are, potentially, two specific ways for social organizations to contribute to China’s NHG system development.

Article

D. van Niekerk, G.J. Wentink, and L.B. Shoroma

Disaster and natural hazard governance has become a significant policy and legislative focus in South Africa since the early 1990s. Born out of necessity from a dysfunctional apartheid system, the new emphasis on disaster risk reduction in the democratic dispensation also ushered in a new era in the management of natural hazards and their associated risks and vulnerabilities. Widely cited as an international best practice in policy and law development, South Africa has led the way in natural hazard governance in sub-Sahara Africa as well as in much of the developing world. Various practices in natural hazard governance in South Africa are alluded to. Particular attention is given to the disaster risks of the country as well as to the various natural hazards that drive this risk profile. Statutory and legislative aspects are discussed through a multisectoral approach, and by citing a number of case studies, we show the application of natural hazard governance in South Africa. Certain remaining challenges are highlighted that are faced by the South Africa government such as a lack of political will at the local government level, deficits in risk governance, difficulties in resource allocation, a lack of intergovernmental relations, and a need for enhanced community participation, ownership, and decision making.

Article

Along with sub-Saharan Africa and South Asia, Latin America and the Caribbean is among the geographic regions most exposed and vulnerable to the occurrence of disasters. The vulnerability is explained by geography and climate, but also by prevailing poverty and inequality. Year after year, multiple disasters such as landslides, hurricanes, floods, rains, droughts, storms, earthquakes, volcanic eruptions, and tsunamis, among others, threaten the region. Natural disasters reveal the deficiencies of infrastructure and essential services. In particular, they highlight the lack of an institutional framework for effective governance with clearly defined goals of how to prevent, respond to, and reconstruct after a natural catastrophe. One of the priorities of governments in the region is to achieve resilience—that is, to strengthen the capacity to resist, adapt, and recover from the effects of natural disasters. To be able to accomplish this, governments need to prepare before a natural disaster strikes. Therefore, disaster risk management is critical. A fundamental element in the strategy of increasing resilience is good planning in general—that is, to reduce inequality, manage urbanization, and invest in necessary infrastructure such as energy, sewage, and water management. Because climate change increases the risk of disasters, it is generally understood that good governance practices can prevent further global warming. Governments might achieve this, for example, by investing in renewable energy and financing other environmentally friendly initiatives. Unfortunately, most current governance models in Latin America and the Caribbean are characterized by bureaucratic structures that are fragmented into different sectors and whose actors do not have much interaction between them. With technical assistance from organizations, such as the World Bank and the United Nations, stakeholders in Latin America and the Caribbean are learning how to develop plans that encourage the collaboration of multiple sectors (e.g., transportation, housing) and improve the working relationships between various institutions (e.g. local associations, NGOs, private and public organizations). To be adequately prepared for a disaster, it is necessary to establish a network of actors that can engage quickly in decision-making and coordinate effectively between local, regional, and national levels.

Article

The field of natural hazards governance has changed substantially since the 1970s as the breadth and severity of natural hazards have grown. These changes have been driven by greater social scientific knowledge around natural hazards and disasters, and by changes in structure of natural hazards governance. The governance of issues relating to natural hazards is challenging because of the considerable complexity inherent in preparing for, responding to, mitigating, or recovering from disasters.

Article

Recent extreme hydrological events (e.g., in the United States in 2005 or 2012, Pakistan in 2010, and Thailand in 2011) revealed increasing flood risks due to climate and societal change. Consequently, the roles of multiple stakeholders in flood risk management have transformed significantly. A central aspect here is the question of sharing responsibilities among global, national, regional, and local stakeholders in organizing flood risk management of all kinds. This new policy agenda of sharing responsibilities strives to delegate responsibilities and costs from the central government to local authorities, and from public administration to private citizens. The main reasons for this decentralization are that local authorities can deal more efficiently with public administration tasks concerned with risks and emergency management. Resulting locally based strategies for risk reduction are expected to tighten the feedback loops between complex environmental dynamics and human decision-making processes. However, there are a series of consequences to this rescaling process in flood risk management, regarding the development of new governance structures and institutions, like resilience teams or flood action groups in the United Kingdom. Additionally, downscaling to local-level tasks without additional resources is particularly challenging. This development has tightened further with fiscal and administrative cuts around the world resulting from the global economic crisis of 2007–2008, which tightening eventually causes budget restrictions for flood risk management. Managing local risks easily exceeds the technical and budgetary capacities of municipal institutions, and individual citizens struggle to carry the full responsibility of flood protection. To manage community engagement in flood risk management, emphasis should be given to the development of multi-level governance structures, so that multiple stakeholders share fairly the power, resources, and responsibility in disaster planning. If we fail to do so, some consequences would be: (1), “hollowing out” the government, including the downscaling of the responsibility towards local stakeholders; and (2), inability of the government to deal with the new tasks due to lack of resources transferred to local authorities.

Article

Nigeria, like many other countries in sub–Saharan Africa, is exposed to natural hazards and disaster events, the most prominent being soil and coastal erosion, flooding, desertification, drought, air pollution as a result of gas flaring, heatwaves, deforestation, and soil degradation due to oil spillage. These events have caused serious disasters across the country. In the southeast region, flooding and gully erosion have led to the displacement of communities. In the Niger Delta region, oil exploration has destroyed the mangrove forests as well as the natural habitat for fishes and other aquatic species and flora. In northern Nigeria, desert encroachment, deforestation, and drought have adversely affected agricultural production, thereby threatening national food security. The federal government, through its agencies, has produced and adopted policies and enacted laws and regulations geared towards containing the disastrous effects of natural hazards on the environment. The federal government collaborates with international organizations, such as the World Bank, International Atomic Energy Agency (IAEA), International Fund for Agricultural Development (IFAD), Center for Infectious Disease Research (CIDR), United Nations Industrial Development Organization (UNIDO), United Nations Environment Programme (UNEP), United Nations High Commission for Refugees UNHCR, and non-governmental organizations (NGOs), to address disaster-related problems induced by natural hazards. However, government efforts have not yielded the desired results due to inter-agency conflicts, corruption, low political will, and lack of manpower capacity for disaster management. There is a need for a good governance system for natural hazards prevention and reduction in the country. This will require inter-agency synergy, increased funding of agencies, capacity building, and public awareness/participation.

Article

Hazard management scholars have begun to develop an important line of inquiry based upon the idea of governance. This growing body of work focuses attention on how the hazard functions that were formerly carried out by public entities are now frequently dispersed among diverse sets of actors that include not only governmental institutions but also private-sector and civil society entities. While informative, this body of work is unduly narrow. In particular, it takes an actor-centric approach to the governance of hazards. A more comprehensive view would account for the relationship between the governance system and the underlying good being produced. Generally speaking, governance systems emerge to manage—or produce—particular goods. Accordingly, these systems will vary depending upon the nature of the underlying good. Thus, while it is important to describe the actors that shape the governance system—as the extant literature does— the failure to recognize or appreciate the relationship between hazards governance and its underlying good is non-trivial. At minimum, without this information scholars and practitioners cannot reasonably assess the efficacy of the system. To better understand hazards governance, there needs to be a clear picture of what the governance system is producing, as well as the defining characteristics thereof. The good being produced by hazards governance systems is resilience, which is both non-rivalrous and non-excludable. Simply stated, resilience can be conceptualized as a public good. Moreover, governance systems in general are comprised of multiple subsystems. In the case of hazards management, the subsystems are mitigation, preparedness, response, and recovery. Thus, the production technologies—aggregate effort, single best effort, and weakest link—will likely vary across the hazards governance system. Showing how these technologies potentially vary across hazard governance systems opens new and important lines of inquiry.

Article

Bureaucratic politics, discretion, and decision-making for natural hazards governance present an important challenge of the use of autonomous bureaucratic discretion in the absence of political accountability. Understanding how these factors influence discretion and policymaking is of critical importance for natural hazards because the extent to which bureaucrats are able to make decisions means that communities will be safer in the face of disaster. But the extent to which they are held accountable for their decisions has significant implications for public risk and safety. Bureaucrats are unelected and cannot be voted out of office. There are two significant areas that remain regarding the use of bureaucratic discretion in natural hazards policy. One key area is to consider the increasing emphasis on networked disaster governance on bureaucratic discretion and decision-making. The conventional wisdom is that networks facilitate disaster management much better than command and control approaches. However, the extent to which the use of bureaucratic discretion is important in the implementation of natural hazard policy, particularly for mitigation and preparedness, remains an open area of research. The other key area is the influence of bureaucratic discretion and decision-making when communities learn after a disaster. The political nature of disasters and the professional expertise of public service professionals imply that in order to make communities safer, bureaucrats will have to use discretion to push forward more aggressive mitigation and preparedness policies. Bureaucratic discretion would need to be used for both political and policy purposes in order to engage in policy learning after disasters that produces a substantive change.

Article

Timothy Mulligan, Kristin Taylor, and Rob A. DeLeo

Policies to manage natural hazards are made in a political context that has three important characteristics: local preferences and national priorities, short-sighted political decision-making, and policy choices informed by experience instead of future expectations. National governments can set broad policy priorities for natural hazard management, but it is often local governments, with conflicting policy priorities and distinctive hazard profiles, that have the authority to implement. Moreover, legislators who are tasked with passing laws to put policies into force are rewarded with reelection by voters who are only concerned with issues that have an immediate impact on their day-to-day lives (e.g., the economy) as opposed to hazards that may or may not occur until some undetermined point in the future. Finally, legislators themselves face challenges making policies to mitigate and manage hazards because they fail to see the longer-term risks and instead make decisions based on past experiences. This article broadly lays out the challenges of the policy environment for natural hazards, including intergovernmental concerns, policy myopia, and shifting policy priorities. It also describes the politics shaping the management of natural hazards, namely, electoral politics, the social dynamics of blame assignment, and the various political benefits associated with disaster relief spending.

Article

Svetlana Badina and Boris Porfiriev

A major implication of the dissolution of the Soviet Union in 1991 involved the radical transformation of the national security system. Its fundamentally militaristic paradigm focused on civil defense to prepare and protect communities against the strikes of conventional and nuclear warheads. It called for a more comprehensive and balanced civil protection policy oriented primarily to the communities’ and facilities’ preparedness and response to natural hazards impact and disasters. This change in policy was further catalyzed by the catastrophic results of the major disasters in the late 1980s, such as the Chernobyl nuclear power plant explosion of 1986 and the Armenian earthquake of 1988. As a result, in 1989, a specialized body was organized, the State Emergency Commission at the USSR Council of Ministers. A year later in the Russian Federation (at that time a part of the Soviet Union), an analogous commission was established. In 1991, it was reorganized into the State Committee for Civil Defense, Emergency Management, and Natural Disasters Response at the request of the president of the Russian Federation (EMERCOM). In 1994, this was replaced by the much more powerful Ministry of the Russian Federation for Civil Defense, Emergency Management, and Natural Disasters Response (which kept the abbreviation EMERCOM). In the early 21st century, this ministry is the key government body responsible for (a) development and implementation of the policy for civil defense and the regions’ protection from natural and technological hazards and disasters, and (b) leading and coordinating activities of the federal executive bodies in disaster policy areas within the Russian Federation’s Integrated State System for Emergency Prevention and Response (EPARIS). In addition, as well as in the former Soviet Union, the scientific and research organizations’ efforts to collect relevant data, monitor events, and conduct field and in-house studies to reduce the risk of disasters is crucially important. The nature of EPARIS is mainly a function of the geographic characteristics of the Russian Federation. These include the world’s largest national territory, which is vastly extended both longitudinally and latitudinally, a relatively populous Arctic region, large mountain systems, and other characteristics that create high diversity in the natural environment and combinations of natural hazards. Meanwhile, along with the natural conditions of significant size and a multiethnic composition of the population, distinctive features of a historical development path and institutional factors also contribute to diversity of settlement patterns, a high degree of economic development, and a level and quality of human life both within and between the regions of Russia. For instance, even within one of the region’s urbanized areas with a high-quality urban environment and developed socioeconomic institutions, neighboring communities exist with a traditional lifestyle and economic relations, primitive technological tools, and so on (e.g., indigenous small ethnic groups of the Russian North, Siberia, and the Far East). The massive spatial disparity of Russia creates different conditions for exposure and vulnerability of the regions to natural hazards’ impacts on communities and facilities, which has to be considered while preparing, responding to, and recovering from disasters. For this reason, EMERCOM’s organizational structure includes a central (federal) headquarters as well as Central, Northwestern, Siberian, Southern, and Moscow regional territorial branches and control centers for emergency management in all of the 85 administrative entities (subjects) of the Russian Federation. Specific features of both the EMERCOM territorial units and ministries and EPARIS as a whole coping with disasters are considered using the 2013 catastrophic flood in the Amur River basin in the Far East of Russia as a case study.

Article

Governance is a complex, highly elastic term used in a wide range of settings which sometimes leads to ambiguity. As a result, defining natural hazards governance as a unique and specific construct is needed for conceptual clarity and analytic precision. At core, natural hazards governance pertains to two fundamental considerations: reducing risk and promoting resilience. While not always recognized as such in the hazards and disasters literature, risk reduction and resilience promotion are two pure public goods. But they are also highly complex public goods—amalgams of a series of distinct but interrelated public policy choices and the administrative systems that put those choices into effect. To understand better a logic for defining and assessing natural hazards governance it is essential to consider it as a set of explicitly collective choices over the production of a complex of public goods aimed at addressing hazards risk reduction and promoting resilience within or across defined political jurisdictions. Those choices create frameworks permitting a set of authoritative actions (lawful and legitimate) to be stated and executed by governmental entities, by non-governmental agents on their behalf (in some form), or for goods and services to be jointly co-produced by governmental and non-governmental actors. Those collective choices in a given setting are influenced by the institutional structure of formal public policy decision-making, which itself reflects variations in the political efficacy of community members, competing interests and incentives over policy preferences, and level of extant knowledge and understanding of critical challenges associated with given hazards. Those formal collective choices are also reflective of a broader cultural context shaping norms of behavior and conception of the relationship between communities and hazards.

Article

Natural disasters pose important problems for societies and governments. Governments are charged with making policies to protect public safety. Large disasters, then, can reveal problems in government policies designed to protect the public from the effects of such disasters. Large disasters can serve as focusing events, a term used to describe large, sudden, rare, and harmful events that gain a lot of attention from the public and from policy makers. Such disasters highlight problems and, as the public policy literature suggests, open windows of opportunity for policy change. However, as a review of United States disaster policy from 1950 through 2015 shows, change in disaster policy is often, but not always, driven by major disasters that act as focusing events. But the accumulation of experience from such disasters can lead to learning, which can be useful if later, even more damaging and attention-grabbing events arise.

Article

Natural hazard governance has become complicated. This is because many recent disasters had the biggest impact in urban areas with a large concentration of people heavily dependent on infrastructure and services. The rapid urbanization, population increase, development of critical engineering works, industrialization of cities with modern types of buildings, and the concentration of population living in hazardous areas are matter of growing concern, as they are likely to contribute to heavier loss of life and increasing economic losses in future disaster damage. The El-Asnam (formerly Orléansville) earthquake of October 10, 1980 (Ms 7.4) raised the awareness of both the Algerian government and the civil society of the need for disaster risk reduction policy. Since then, disaster risk reduction has been on the agenda of the government programs, and concrete measures have been undertaken in organization, legislation, institutions, training, education, communication, and information. The government has made significant efforts to improve the natural hazard governance. It has made a substantial impact on academic research and higher education in some disciplines of engineering and natural science in the country’s largest universities. Risk governance for natural hazard in Algeria will be seen here in light of the implementation mechanisms, the main achievements and progress, the new legal and regulatory tools and mechanisms, and cooperation aspects. In conclusion there will be a discussion about global evaluation and perspectives.

Article

Mihir Bhatt, Ronak B. Patel, Kelsey Gleason, and Mehul Pandya

Both the impact and the frequency of natural disasters and extreme events in South Asia are steadily increasing due to growing exposure and vulnerability. These vulnerabilities are compounded by fast economic growth and an increase in natural disasters across the region. Disaster losses in South Asia are rising and are felt across many domains. From the formal to the informal economy, natural disasters have increasingly strong impacts in terms of lives lost, social impact, and impediments to growth. New challenges in disaster risk reduction are emerging due to an increase in the duration and frequency of natural disaster events attributable to climate change. Though both climate change adaptation and disaster risk reduction efforts exist to some degree throughout South Asia, integrating climate change adaptation into disaster risk reduction is critical to successful and inclusive growth of economies in the region. Challenges remain, and national and subnational governments are making some progress in policies aimed at both climate change adaptation and disaster risk reduction. However, many of these efforts are planned, designed, and implemented separately, with limited understanding of how disaster and climate risk are linked. Moreover, progress is hindered by poor understanding of how integration of these concepts can result in better governance of risk in South Asia. Additionally, political will, capacity constraints, and institutional barriers must be overcome. Efforts by the international community are making progress in unifying these concepts, yet gaps and challenges still exist. The benefits of converging climate adaptation and disaster risk reduction in Asia are significant, from minimizing climate-related losses to more efficient use of limited resources and more effective and sustainable development.

Article

The current outlook in disaster risk management in Turkey is examined in its historic context in this article. Policies, legislation, and specific responsive actions have culminated in 2009 in the formation of a nationwide Disaster and Emergency Management Authority (“Afet ve Acil Durum Yönetimi Başkanlığı” or AFAD in Turkish) that reports directly to the prime minister. Earthquakes are the principal drivers for disaster management in Turkey. The assessment of the system in effect in Turkey from a management science viewpoint is summarized. The chronological description of the Turkish system has been linked to major disaster occurrences and consequent legislative changes.

Article

As with countless other policy areas, natural hazard policy can be viewed as a jurisdictional competition between executive and legislative branches. While policymaking supremacy is delegated to the legislative branch in constitutional democracies, the power over implementation, budgeting, and grant-making that executive agencies enjoy means that the executive branch wields considerable influence over outcomes in natural hazards policymaking. The rules that govern federal implementation of complex legislative policies put the implementing agency at the center of influence over how policy priorities play out in local, county, and state processes before, during, and after disasters hit. Examples abound related to this give-and-take between the legislative and executive functions of government within the hazards and disaster realm, but none more telling than the changes made to US disaster policy after September 11th, which profoundly affected natural hazards policy as well as security policy. The competition and potential for mismatch between legislative and executive priorities has been heightened since the Federal Emergency Management Agency (FEMA) was reorganized under the Department of Homeland Security. While this may appear uniquely American, the primacy of terrorism and other security-related threats not only dwarfs natural hazards issues in the United States, but also globally. Among the most professionalized and powerful natural hazards and disaster agencies prior to 9/11, FEMA has seen its influence diminished and its access to decision-makers reduced. This picture of legislative and executive actors within the natural hazards policy domain who compete for supremacy goes beyond the role of FEMA and post-9/11 policy. Power dynamics associated with budgets, oversight and accountability, and relative power among executive agencies are ongoing issues important to understanding the competition for policy influence as natural hazards policy competes for attention, funding, and power within the broader domain of all-hazards policy.

Article

Natural disasters cause massive social disruptions and can lead to tremendous economic and human losses. Given their uncertain and destructive nature, disasters invariably induce significant governmental responses and typically pose severe financial challenges for jurisdictions across all levels of government. From a public finance perspective, disasters cause governments to incur additional spending on various emergency management activities, and by disrupting normal business activities they also affect tax base robustness and cause revenue losses. The question is: How significant are these fiscal effects and how do they affect hazards governance more generally? Understanding the fiscal implications of natural disasters is essential to evaluating the size of the economic costs of disasters as well as forecasting governments’ financial exposure to future shocks. Furthermore, how disaster costs are shared among different levels of government is another important question concerning the intergovernmental dynamics of disaster management. In the U.S. federal system, the direct fiscal costs of natural disasters (i.e., increased government expenditures due to disaster shocks) are largely borne by the federal government. It is estimated that Hurricane Katrina cost the federal government approximately $120 billion while Hurricane Sandy cost $60 billion. Even in the years without large-scale disaster events, federal disaster spending is between $2 billion and $6 billion annually. Under the Stafford Act, the federal government plays a critical role in funding disaster-related programs (e.g., direct relief, mitigation grants, and subsidized insurance programs) and redistributing the actual costs of natural hazards, meaning that a considerable portion of the local disaster burden is shifted to all U.S. taxpayers. This raises a set of issues concerning the equity and efficiency of the U.S. disaster policy framework. Managing disasters involves multiphased activities to mitigate, prepare for, respond to, and recover from disaster shocks. There is a common belief that the federal government inappropriately spends far more on ex post disaster response, relief, and recovery than what it spends on ex ante mitigation and preparedness, often driven by political motivations (e.g., meeting voters’ preferences for postdisaster aid) and the current budget rules. As pointed out by many others, federal disaster relief and assistance distort the subnational incentive to invest in local disaster prevention and mitigation efforts. Furthermore, given the mounting evidence on the cost-effectiveness of disaster mitigation programs in reducing future disaster damages, the current practice of focusing resources on postdisaster assistance means substantial public welfare losses. In recent years there has been a call for the federal government to shift its disaster policy emphasis toward mitigation and preparedness and also to facilitate local efforts on mitigation. To achieve the goal requires a comprehensive reform in government budgeting for emergency management.