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Dull Disasters?How planning ahead will make a difference$

Daniel J. Clarke and Stefan Dercon

Print publication date: 2016

Print ISBN-13: 9780198785576

Published to Oxford Scholarship Online: June 2016

DOI: 10.1093/acprof:oso/9780198785576.001.0001

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(p.vii) Preface

(p.vii) Preface

Dull Disasters?

Stefan Dercon

Oxford University Press

This book stems from our urge to communicate that there is a better way of protecting people from the dire effects of natural disasters, particularly in developing countries. As academics and professionals, we have worked on risk and insurance for much of our careers. In the pages that follow, we want to share what we have learned, and, in doing so, contribute to better thought and action on how to shield people and property from the consequences of extreme natural events such as floods, droughts, earthquakes, and pandemics. In short, we will look at how to ‘dull’ disasters, making sure that such events do not lead to enduring levels of hardship.

One of us, Stefan, has studied for decades how risk affects people in some of the poorest settings in the world, such as in Ethiopia and Tanzania, but also how the poor have devised ingenious ways to limit the consequences of shocks to their incomes and livelihoods. And yet, despite their valiant attempts, they continue to struggle to handle extreme events such as droughts or floods, which have bleak short- and long-term consequences for children and adults. They end up losing their meagre possessions, risk dying too young, or become disabled from poor nutrition. One of the reasons for writing this book is to promote better ways of helping people avoid these outcomes.

Daniel was first a trained actuary, before studying to become an economist. He brings the world of finance and insurance to these problems, asking what can finance do (and what it cannot do) to improve risk management? As researchers, we collaborated in thinking through improving systems for financing risks at the household level. Can insurance ever make sense? Are the current pilot initiatives (p.viii) really offering solutions? Can we find ways of designing insurance systems to complement and strengthen the risk-coping mechanisms poor people already use?

In recent years, we both have become strongly immersed in the world of development policy and practice. Daniel joined the Disaster Risk Financing and Insurance Program, a partnership between the World Bank and the Global Facility for Disaster Reduction and Recovery (GFDRR), designed to help governments and their partners improve how they manage disaster risk. He has worked with some forty developing countries towards implementing the sort of solutions described in this book, and he has seen first-hand the commitment of professionals and the importance of them working together towards politically sellable solutions. Unfortunately, quite a few countries are continuing to find the job of disaster risk management challenging. But there are clearly positive lessons to be learned from other countries, and we share some of these in this book.

Stefan is Chief Economist at the Department for International Development (DFID), the government department responsible for the UK’s development aid and policy. At DFID, he advises on more or less anything and everything. Anyone working at DFID, one of the world’s largest humanitarian and development donors, cannot help but be struck by the state of the global humanitarian system. It is under pressure—even broke, it is said—drained financially by large and costly conflict-related humanitarian crises. Finding better funding models, at least for problems that are more tractable, such as for natural disasters, is more important than ever.

Both of us are convinced that at both the country and global levels people can be better protected against the dire consequences of extreme natural events. Although what we have learned about risk and insurance is important, we have realized from our work that things poor people themselves have found to work well could serve as models for application nationally and globally. Across the world and throughout history, people have set up what are essentially mutual insurance arrangements in which groups support each other, (p.ix) abiding by clear and credible rules that make the arrangements sustainable. These were the types of arrangements we have studied at the local level in Ethiopia.

Clearly, the national and global challenges in dealing with natural disasters are tougher than the problems these groups can solve. Nevertheless, in this book we will show that the rules and systems these groups use are essentially sound protection principles that could inspire national governments and international agencies as well. It will no doubt not be easy to move towards the new approach laid out in this book. That will require careful technical work as well as courage and commitment by political leaders. Some have risen to this challenge with more credible disaster planning and financing. It is hoped that this book will inspire others to follow. (p.x)