Earthquake Risk in Japan: Consumers' Risk Mitigation Responses After the Great East Japan Earthquake

Abstract

Abstr actThe Great East Japan Earthquake and subsequent tsunami on March 11 were a reminder of Japan's huge earthquake risk and need for preparedness. The northeastern part of the country witnessed devastating human suffering and physical damage. The destructive impact of the earthquake has enhanced consumer's earthquake preparedness even in unaffected areas. This paper uses unique survey data collected after the earthquake to study how consumers reacted to this catastrophic event. We find that self-reported, perceived preparedness for natural disasters has significantly improved even among low-income households after March 11, but that post-quake intentions for more specific risk mitigation activities were systematically associated with household income and wealth levels. High income households are more likely to plan purchase of earthquake insurance or to conduct seismic retrofitting following the March 11th earthquake, indicating that the recent events might have widened the gap in disaster preparedness between rich and poor.

Disaster preparedness among households in the Badakhshan Province in Afghanistan: A baseline evaluation study

“…In another study, which was conducted in Alabama in the United States, McCormick et al (2013) found that individuals whose annual income fell below $25,000 were less prepared for an emergency than individuals who had a higher income. Similar findings were echoed in a study conducted in Japan following the 2011 Sendai earthquake and subsequent tsunami (Naoi et al, 2012).…”

“…Studies have consistently shown an association between socioeconomic status and disaster preparedness in the United States 2014McCormick, Pevear, & Xie, 2013;Russell et al, 1995) and international samples (Naoi, Seko, & Ishino, 2012;Tekeli-Yesil et al, 2010). A study conducted in Turkey (Tekeli-Yesil et al, 2010) showed correlations between income and education and predisaster preparedness: Individuals with better economic security and high educational attainment tend to be more prepared in times of an emergency event.…”

Earthquake Risk Embedded in Property Prices: Evidence from Five Japanese Cities

“…We also mention two survey-data studies on how risk preferences of households have changed after the Tohoku earthquake (the Great East Japan earthquake) in 2011. Naoi et al (2012) find that although respondents seemed to be more prepared for natural disasters after the Tohoku experience, actual (costly) mitigation activities depend on household income. Hanaoka et al (2015) examine whether risk preferences of men and women have changed, and if so whether they changed in a different way, after the Tohoku earthquake.…”

Financial Vulnerability and Personal Finance Outcomes of Natural Disasters

“…Those in neighboring areas who were not directly affected also are more likely to prepare. In an analysis of the aftermath of the 2011 earthquake and subsequent tsunami in Japan, self-reported preparedness for natural disaster increased (Naoi et al, 2012). Specifically, 60 percent of respondents to a survey reported that they were better prepared at the time of the survey than they were before the disaster.…”