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Firm-level Impacts of Natural Disasters on Production Networks: Evidence from a Flood in Thailand

Discussion Papers


by Kazunobu HAYAKAWA, Toshiyuki MATSUURA, and Fumihiro OKUBO
February 2014


In this paper, we explore the firm-level impacts of flooding in Thailand in 2011, specifically those on the procurement patterns at Japanese affiliates in Thailand. Our findings are as follow. First, the damaged small firms are more likely to lower their local procurement share, particularly the share of procurement from other Japanese-owned firms in Thailand. Second, damaged young firms and damaged old firms are more likely to raise the shares of imports from Japan and China, respectively. Third, there are no impacts on imports from ASEAN and other countries. These findings are useful for uncovering how multinational firms adjust their production networks before and after natural disasters.

Keywords: Natural disasters, flooding, production networks
JEL classification: D22; F23; Q54

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