Date of Award

1-1-2022

Language

English

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

College/School/Department

Department of Public Administration and Policy

Content Description

1 online resource (viii, 162 pages) : illustrations (some color), color maps

Dissertation/Thesis Chair

Gang Chen

Committee Members

Jennifer Dodge, Ashley Fox

Keywords

Disaster management, Financial risk management, Fiscal spillover effect, Intergovernmental relationship, Public finance, Disaster relief, Local finance, Equality, Disaster victims

Subject Categories

Public Administration

Abstract

This dissertation explores how various types of disasters affect the financial behaviors of local governments, interacting with public managerial decisions, intergovernmental aid, and community-context effects. The first essay examines whether 1) disaster aid distribution is associated with social vulnerability indicators of affected counties given the same level of disaster damage, and 2) ethnic representativeness of the Federal Emergency Management Agency (FEMA) workforce increases policy benefits in terms of disaster relief funds for counties with a higher level of vulnerability related to minority status. I use hierarchical linear modeling (HLM) to test the U.S. counties that have received disaster aid funds for the years 2006–2019. I find that a positive association between disaster damage and the federal fund for disaster relief is even more pronounced in low-vulnerable communities. Results also show that in the high-vulnerable counties, the impact of damage on the federal fund gets greater as the share of minority officials increases, resulting in the reduced gap in the fund received between the higher- and less- vulnerable counties. This study highlights the potential of representative bureaucracy that could be conceived as a form of procedural justice leading to a more equitable distribution of policy benefits in disaster management.The second essay explores how social capital moderates the financial shocks of disasters for governments with a higher proportion of vulnerable groups. For this study, I differentiate U.S. county-level nonprofits into Putnam-, Olson-, and Recreation- types to test the effect of each respective type of social capital. I collected nonprofit organizations coded as 501c(3)-(8) and 501c(10) by the Internal Revenue Service (IRS). Using a fixed-effect model with first-difference stationary data, I find that in high-vulnerability counties, disaster damage leads to an increase in additional government spending associated with some safety-net programs, e.g., hospital, housing, and public welfare expenditure. However, when such a vulnerable county holds a higher level of social capital the effect of disasters on the additional costs decreases significantly. In particular, Olson's social capital, which is rent-seeking and engages in political activities, has a more prominent moderating effect on the relationship between disasters and additional welfare costs in vulnerable counties. I believe that this study can contribute to the literature on the financial impact of disasters by taking into account the demand-side factors that determine the spending need for public policies associated with disaster relief. For the last essay, I draw on the fiscal spillover literature to test three different hypotheses: Damage spillover hypothesis, demand spillover hypothesis, and expenditure spillover hypothesis. I employ a spatial Durbin model (SDM) that includes both spatially lagged dependent and independent variables so that I can better account for the channels through which geographically close neighboring localities can influence each other in terms of their finance. Using data on all U.S. counties, I find that the expenditure levels of a local government and its neighboring governments have a positive relationship, suggesting mimicking behaviors of jurisdictions with spatial connections. When decomposing the spatial effects of disaster damage and the population in need, findings show that the neighboring, indirect effect of disaster damages lead to a shift in priorities of local governments toward devoting more resources to meet immediate public needs such as public welfare and health, reducing spending on long-term services. However, when their neighborhoods have a high proportion of vulnerable populations, the local government is also likely to serve long-term needs such as housing and public safety services. This study advances the extant literature on fiscal spillovers using vulnerable populations and disasters as a new instrument for the change in financial outcomes. Practically, it provides implications for an effective intergovernmental approach to addressing disaster-induced financial distress.

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