DOES NATURAL DISASTER AFFECT ALCOHOL CONSUMPTION IN THE LONG RUN?
–NATURAL EXPERIMENT FROM THE GREAT EAST JAPAN EARTHQUAKE–Taiki Kakimoto † and ○Shinsuke Uchida∗

1. Introduction
Large-scale disasters are known to increase prompt alcohol consumption of disaster victims, but its potentiallyprolonged phenomenon have been rarely tracked. Medical studies limit their analyasis on one-shot survey and/or
fail to set up the randomized control trial situation, mainly due to difficulties in retrospective data collection. Recenteconomic studies merit attention which use longitudinal survey data to identify the causal impacts on humanwellbeing and risk-taking behaviors from the Great East Japan Earthquake and the Fukushima-Daiichi nuclear
power plant accident in 2011 (e.g., Rehdanz et al., 2015; Sugano, 2016; Hanaoka et al., 2018). While they take anadvantage of using the difference-in-differences approach to quantify such impacts, data availability confines themto short-term analysis with two periods just before and after the disaster. This study aims to complement them byexamining the continued impact of the Great East Japan Earthquake and the subsequent Fukushima accident onalcohol consumption. Long-term monthly panel data of alcohol expenditure in 47 prefectural capital cities allow us
to quantify the dynamics of alcohol consumption in the long run.

2. Data and Methods
We use the monthly household alcohol expenditure data from the Family Income and Expenditure Survey at capitalcities in 47 prefectures from January 2008 to December 2014. Our identification strategy relies on exogenous
variations in the seismic intensity (SI) across sample cities at the time of the Great East Japan Earthquake as wellas in the change of ambient radiation levels caused by Fukushima-Daiichi nuclear power plant accident in 2011.
Such natural experiment enables us to conduct the difference-in-differences method to quantify the causal disaster
impacts on alcohol consumption. The long-term continous data also allows us to validate the parallel trend
assumption between treatment and control groups. In addition, we control for possibly all socioeconomic and†∗AD Planner Co.
Graduate School of Economics, Nagoya City University. Email: suchida@econ.nagoya-cu.ac.jp.

climactic factors that affect alcohol consumption. We also employ city-by-month and year-by-month fixed effects
to control for other potentially confounding factors. Our estimate can then capture the disaster impacts arising fromunobserved determinants of household members such as psychological and physical stresses and risk preference.
The analysis is further extended to compare the disaster impacts among different types of households.
Comprehensive clarification of the heterogenous impacts of different types of disasters among different types ofhouseholds can assist in policy formulation in disaster recovery.

3. Results and Concluding Remarks
We find that the proportion of alcohol beverages spent by average households in severely damaged cities (SI of 6)
significantly increased by more than 10 percentage point as compared to households in literally no damaged areas(SI of 3 or less) after 4 years of the disaster. We also find that the effect developed over time. This trend wasparticularly pronounced for non-employed households (heads of households are mostly retired). Our results
indicates that alcohol consumption increased in the long run due to stress caused by anxiety or disappointment about
the slow recovery of local economy. Such stress particularly overwhelmed unemployed (retired) households. Publicor private assistance programs need to consider appropriate timing, space, and socioeconomic status in designingeffective supports.

References
Hanaoka, C., H. Shigeoka and Y. Watanabe. (2018) “Do Risk Preferences Change? Evidence from the Great East
Japan Earthquake.” American Economic Journal: Applied Economics, 10(2): 298-330.
Rehdanz, K., H. Welsch, D. Narita and T. Okubo. (2015) "Well-being effects of a major natural disaster: The caseof Fukushima." Journal of Economic Behavior & Organization, 116(C): 500-517.
Sugano, S. (2016) “The Well-Being of Elderly Survivors after Natural Disasters: Measuring the Impact of the Great
East Japan Earthquake.” The Japanese Economic Review, 67(2): 211-229.