January 03, 2005
Making Nations Richer and Safer
Timothy Terrell presents some data showing a nation's wealth determines how deadly natural disasters are. To generate wealth states must "allow people to interact in the marketplace without government intrusion." He then counters the belief that more regulation and government programs are needed by using the all-important idea of tradoffs:
Regulation to put technological fixes into place takes away from other contributors to disaster mitigation. Requiring stronger structures means that people cannot devote as many resources to improving communication (to find out in advance about coming disaster), transportation (to get away from approaching calamity), medical care (to keep injuries from turning into deaths, or to treat post-disaster diseases), and so on. In fact, any government mandate is likely to overemphasize some fraction of disaster mitigation, rather than allow people to choose for themselves the appropriate mix. Government funding of tsunami warning systems, for example, may require such an investment in communications networks that medical care or transportation are underfunded. Trying to fund all of these elements of mitigation through the state implies such high taxation that the incentive to produce is reduced, and economic growth is stunted. In fact, more resources going toward disaster mitigation of any type means giving up other things that contribute to long life and well-being: a better diet, education, freedom from crime, safer workplaces, and family and religious obligations.
UPDATE: One effect of the lack of wealth is poor infrastructure as noted by James Joyner.