International Journal of Economics, Finance and Management Sciences

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Measurement of Fiscal Vulnerability from Natural Disasters – The Case of Albania

Received: 30 September 2013    Accepted:     Published: 30 October 2013
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Abstract

Natural disasters bring destruction and severe effects in the countries they hit. In small countries like Albania, where the insurance market is underdeveloped, the main role in absorbing disaster effects is often responsibility of the government. In this approach, the government is exposed from a fiscal point of view to the risk of natural disasters. This paper aims to measure the level of fiscal vulnerability in a country like Albania, caused by disasters that time after time hit the region, such as earthquakes or flood. This has been realized by calculating the disaster deficit index for earthquakes and flood, and the annual expected average loss from earthquakes. The results show for a high level of fiscal vulnerability in case of floods with a return period of 100 years and in case of earthquakes with a magnitude higher than 6.5 on Richter scale.

DOI 10.11648/j.ijefm.20130106.15
Published in International Journal of Economics, Finance and Management Sciences (Volume 1, Issue 6, December 2013)
Page(s) 292-298
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This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Disaster, Fiscal Vulnerability, Risk, Disaster Deficit Index

References
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[2] Aliaj, Sh. Koçiu, S. Muço B. Sulstratova E. (2010). Sizmiciteti, sizmotektonika dhe vlerësimi i rrezikut sizmik në Shqipëri, Tiranë: Akademia e Shkencave të Shqipërisë.
[3] Arrow K & Lind R. (1970) Uncertainty and the evaluation of public investment decisions, The American Economic Review 60, 364-378.
[4] Banks E. (2005) Catastrophic Risk, Analysis and Managemen, Wiley.
[5] Benson C. (2003) Potential approached to the development of indicators for measuring risk from a macroeconomic perspective. IDB/IDEA Program of indicators for Disaster Risk management National University of Colombia, Manizales.
[6] Briguglio L. (2003) The Vulnerability Index and Small Island Developing States: A Review of Conceptual and Methodological Issues, Paper prepared for the AIMS Regional Preparatory Meeting on the Ten Year Review of the Barbados Programme of Action: Praia, Cape Verde
[7] Briguglio L. (2004) Economic Vulnerability and Resilience: Concepts and Measurements." In Briguglio, L. and Kisanga, E.J. ( eds) Economic Vulnerability and Resilience of Small States, Malta: Islands and Small States Institute and London: Commonwealth Secretariat
[8] Cannon T. (2003) Vulnerability analysis, livelihoods and disaster components and variables of vulnerability: Modeling and analysis for disaster risk management, IBD/IDEA Program of Indicators for Risk Management.
[9] Cardona O. Hurtado J. Duque G. Moreno A Chardon A. Velasquez L & Prieto S. (2004a) Disaster risk and risk management benchmarking: A methodology based on indicators at National level. IDB/IDEA Program of indicators for Disaster Risk management National University of Colombia, Manizales.
[10] Cardona O. (2007, March 23-24). A system of indicators for disaster risk management in the Americas. Globalization, diversity and inequality in Latin America: The challenges, opportunities and dangers (p. 53-72). University of Pittsburgh.
[11] Cardona O. & Carreno G. (2011) Updating the indicators for disaster risk and risk management for the Americas. Journal of integrated disaster risk management Nr 1(1) DOI: 10.5595/idrim.2011.0014.
[12] Grossi P. & Kunreuther H. (2005) Catastrophe modeling: a new approach to managing risk, Springer.
[13] Lito G. (2013). Një model agregat vlerësimi i riskut të katastrofave natyrore në Shqipëri. Revista Shqiptare Social-Ekonomike, Nr 1 (74) 211-220.
[14] Ministry of Finance of Albania (2003- 2012) "Fiscal Statistics".
[15] Perduzzi P. Dao H. Herold C. & Mouton F. (2009) Assessing global exposure and vulnerability towards natural hazards, Natural Hazards and Earth Systems Sciences, 9, 1149-1159, 2009
[16] Selenica A. & Bogdani M. (1996) Catastrophic floods and their risk in rivers of Albania, Destructive Water: Water-caused natural disasters, their abatement and control, Conference proceedings, IAHS n.239.
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Author Information
  • Department of Finance, University of Tirana, Faculty of Economics

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  • APA Style

    Gerdi LITO. (2013). Measurement of Fiscal Vulnerability from Natural Disasters – The Case of Albania. International Journal of Economics, Finance and Management Sciences, 1(6), 292-298. https://doi.org/10.11648/j.ijefm.20130106.15

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    ACS Style

    Gerdi LITO. Measurement of Fiscal Vulnerability from Natural Disasters – The Case of Albania. Int. J. Econ. Finance Manag. Sci. 2013, 1(6), 292-298. doi: 10.11648/j.ijefm.20130106.15

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    AMA Style

    Gerdi LITO. Measurement of Fiscal Vulnerability from Natural Disasters – The Case of Albania. Int J Econ Finance Manag Sci. 2013;1(6):292-298. doi: 10.11648/j.ijefm.20130106.15

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  • @article{10.11648/j.ijefm.20130106.15,
      author = {Gerdi LITO},
      title = {Measurement of Fiscal Vulnerability from Natural Disasters – The Case of Albania},
      journal = {International Journal of Economics, Finance and Management Sciences},
      volume = {1},
      number = {6},
      pages = {292-298},
      doi = {10.11648/j.ijefm.20130106.15},
      url = {https://doi.org/10.11648/j.ijefm.20130106.15},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.ijefm.20130106.15},
      abstract = {Natural disasters bring destruction and severe effects in the countries they hit. In small countries like Albania, where the insurance market is underdeveloped, the main role in absorbing disaster effects is often responsibility of the government. In this approach, the government is exposed from a fiscal point of view to the risk of natural disasters. This paper aims to measure the level of fiscal vulnerability in a country like Albania, caused by disasters that time after time hit the region, such as earthquakes or flood. This has been realized by calculating the disaster deficit index for earthquakes and flood, and the annual expected average loss from earthquakes. The results show for a high level of fiscal vulnerability in case of floods with a return period of 100 years and in case of earthquakes with a magnitude higher than 6.5 on Richter scale.},
     year = {2013}
    }
    

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    AB  - Natural disasters bring destruction and severe effects in the countries they hit. In small countries like Albania, where the insurance market is underdeveloped, the main role in absorbing disaster effects is often responsibility of the government. In this approach, the government is exposed from a fiscal point of view to the risk of natural disasters. This paper aims to measure the level of fiscal vulnerability in a country like Albania, caused by disasters that time after time hit the region, such as earthquakes or flood. This has been realized by calculating the disaster deficit index for earthquakes and flood, and the annual expected average loss from earthquakes. The results show for a high level of fiscal vulnerability in case of floods with a return period of 100 years and in case of earthquakes with a magnitude higher than 6.5 on Richter scale.
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