Socio-economic consequences of post-disaster reconstruction in hazard-exposed areas

Abstract

With coastal populations growing and sea levels rising, reconstruction decisions after coastal disasters are increasingly consequential determinants of future societal vulnerability and thus the sustainability of development. The humanitarian sector tends to favour rebuilding in-place to avoid the social disruptions of mass relocation, yet evidence on what affected people want is mixed. Using the case of post-tsunami Banda Aceh, Indonesia, we investigate whether a policy to rebuild in-place in the disaster-affected area suits an urban population that was previously unaware of the hazard. We show that following the tsunami, a substantial proportion of the population prefers to live farther from the coast. This has caused a new price premium for inland properties and socio-economic sorting of poorer households into coastal areas. These findings show that offering reconstruction aid predominantly within a hazard-exposed area can inadvertently transfer disaster risk to the poor.