Corruption, Homelessness and Disasters

We argue that corruption causes greater homelessness following disasters because it weakens resilience, drains resources, and stifles recovery. We test this argument using data on homelessness from the Emergency Events Database (EM-DAT) and data on corruption in the construction sector from the World Bank's Enterprise Surveys. Using instrumental variables and other estimation techniques, we find that corruption is associated with significantly more people left homeless in the wake of disaster. Corruption in the construction sector is of particular concern, as once it is controlled for, the general level of corruption is not associated with post-disaster homelessness. These findings underline the importance of tackling corruption and poor construction practices in vulnerable communities. Furthermore, they highlight the need to mitigate the impact of corruption pre-disaster, plan for building collapse during the initial disaster response, and factor significant levels of homelessness and displacement into long term disaster recovery plans.