| Number |
CREPEDP-151 |
| Publication Date |
March 2024 |
| Title |
"Building Business Resilience to Disaster"
|
| Author |
Yutaro Izumi, Hiroyuki Nakata, Yasuyuki Sawada, and Kunio Sekiguchi
|
| Abstract |
This paper studies the impacts of natural disasters on corporate disaster risk management.
Using unique plant-level data from Thailand collected after the 2011 floods,
we find that inundation/direct loss experience stimulates flood risk awareness and
encourages plants to develop a business continuity plan (BCP), but indirect loss experience
does not. We also find evidence consistent with the existence of nonnegligible
fixed costs in BCP development. Furthermore, subscription to flood insurance amongst
plants with inundation/direct loss experience dropped after the floods, suggesting that
a BCP acts as a critical substitute for insurance as part of disaster risk management
strategies.
|
| Keywords |
Business continuity plan (BCP); disaster; insurance; risk awareness,
risk management.
|
| Other information |
Paper in English (51 pages) |