Earthquake exposure and schooling: impacts and mechanisms [WP]

Abstract

Natural disasters are a significant threat to human development. In this paper, we analyze the effects of being exposed to a strong earthquake during school age on schooling outcomes. We merge geolocated data about the intensity of the shock at the district level with individual information from the Indonesia Family Life Survey. The identification strategy exploits variation in exposure to the natural shock by birth cohort and district of residence, considering as the treated group individuals who were residing in affected districts while they were in school age. Earthquake exposure reduces years of schooling by somewhat less than one year and negatively affects the probability of completing compulsory education but does not alter the chances of enrolling into post-compulsory education. Falsification analysis and several robustness checks corroborate the causal interpretation of our findings. The analysis of the potential mechanisms indicates that induced migration and casualties occurring at the family level as a consequence of the earthquake do not seem to play a relevant role. However, damages in educational infrastructures do represent a relevant channel through which natural disasters harm human capital formation. Part of the overall impact of the earthquake represents a delay in schooling progression, but a substantial share of its effect consists in a permanent loss of human capital among affected individuals.