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Assessing the economic impact of tsunami and nuclear power plant disasters in Shizuoka, Japan: a dynamic inter-regional input–output (IRIO) approach

Abstract

Natural disasters cause damage to regional economies. This study investigated how production activities in 35 municipalities of Shizuoka Prefecture recover when such activities stop due to a nuclear power plant disaster and tsunami that may be caused by a Nankai Megathrust Earthquake (NME). We developed a dynamic inter-regional input–output model (IRIO) featuring a production bottleneck due to a shortage of inputs and other goods. Using a simulation model, the economic damage caused by single and combined disasters was evaluated based on several recovery scenarios. The effect of depopulation in Japan on post-disaster recovery processes was also examined. This analysis provides useful disaster preparedness information for local governments and companies.

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Notes

  1. 1.

    In this situation, there are two bottlenecks: the production technology bottleneck caused by the inability to substitute input goods and the traffic bottleneck caused by the interruption of the transportation network. This study focuses on the former bottleneck in production technology.

  2. 2.

    In general, labor and capital tend to have different recovery dynamics. This model makes no distinction between labor and capital and we assume a common recovery rate for simplicity. This assumption should be relax considering labor mobility after a disaster for further study.

  3. 3.

    Inventory is not considered in this model. Inventory is likely to occur during a disaster and can be useful during recovery. The role of inventory is discussed by Baker and Santos (2010) and Hallegate (2014).

  4. 4.

    The overlapping hazard maps use the tsunami inundation area for each prefecture. The hazard map of Shizuoka Prefecture uses the tsunami inundation area presented in “Estimation of ground motion and tsunami inundation of earthquake occurring along the Sagami Trough” (revised in March 2016). The inundation area of the six cases of the Nankai Megathrust Earthquake and the three cases of the largest earthquake occurring along the Sagami Trough were superimposed. In this study, only the inundation area of the tsunami was targeted, so the damage caused by earthquake shaking and liquefaction was not considered.

  5. 5.

    In the Nuclear Emergency Countermeasures Guide, for nuclear disaster countermeasures, an area is designated for preparing preventive protective measures called a Precautionary Action Zone (PAZ), an area with a radius of three to five km from a nuclear power plant. An area is also designated for preparing emergency protective measures, an Urgent Protective Action Planning Zone (UPZ), which is area with a radius of approximately 30 km from a nuclear power plant (Nuclear Regulatory Commission). In the past, the range of priority areas for conducting disaster prevention measures in preparation for a nuclear disaster was assumed to be an area with a radius of eight to 10 km from a nuclear power plant, but since the Fukushima nuclear accident, regional disaster prevention plans and evacuation plans related to nuclear disaster countermeasures have been formulated with a range of 30 km.

  6. 6.

    The scale of economic damage in the production sector is approximated by the number of employees. The damage rate at the municipal level is estimated using the number of employees at the small zone level. Employment data for about 3,600 small zones are aggregated into 35 municipalities. We assume a situation in which all production activities in the disaster area are immediately stopped after the nuclear accident and resulting tsunami. The damage rate might vary depending on the tsunami’s inundation depth and the level of radiation risk, but these issues are not considered in this analysis.

  7. 7.

    The case of simulation is set by combining several data sets. Each coefficient of the dynamic model in normal time (0th period) is obtained from the 2011 interregional input–output table. The direct damage rate in the 1st period is estimated from the 2014 economic census (small zone data) and tsunami hazard map. For the future population decline rate, the data for the period from 2015 to 2045 is used. Note that due to data constraints, they are not adjusted for the same year in the future.

  8. 8.

    The process of recovery of the added value is given exogenously. This enables our analysis to consider a variety of scenarios. The linear recovery function has the advantage that the recovery period can be simply calculated as 1 / α if there are no indirect effects. It is also possible to assume a different recovery function. If you want to consider the situation in which the recovery rate differs according to production sector, see, e.g., Li and Haimes (2006).

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Acknowledgments

This research was partially supported by JSPS Grants-in-Aid for Scientific Research, JP17H02521 and JP20K01664.

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Correspondence to Hiroyuki Shibusawa.

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Shibusawa, H., Matsushima, D. Assessing the economic impact of tsunami and nuclear power plant disasters in Shizuoka, Japan: a dynamic inter-regional input–output (IRIO) approach. Asia-Pac J Reg Sci (2021). https://doi.org/10.1007/s41685-021-00196-6

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Keywords

  • Tsunami
  • Nuclear power plant
  • Economic damage
  • Resilience
  • Inter-regional input–output analysis (IRIO)

JEL Classification

  • Q54
  • R15