Post-Disaster Recovery and A New Economic Growth Path: A Comparative Study of Three Provinces in Indonesia

Abstract

The purpose of this study is to examine whether there exists a new regional output growth path in post-disaster situation in three provinces of Indonesia affected by relatively large-scale natural disasters, i.e. Aceh, West Sumatera (Sumbar), and Yogyakarta. By using real Gross Regional Domestic Product time series for the period 2001-2017 obtained from the Central Agency of Statistics, a comparative analysis was made from the differences in the effects across those provinces between pre-disaster and post-disaster periods. This study used a simple model with deterministic trend, post-disaster recovery dummy and autoregressive component to estimate changes in the coefficients of trends for each province's output growth path. The results show that there is no significant difference in the overall effects of trend changes across provinces, while the effects of trend changes between pre-and post-disaster periods vary across provinces and in general post-disaster interventions do not move upward the long-term effects on regional output trends.