Natural Disasters and Social Capital: Evidence from a Field Experiment in Pakistan

Abstract

Apart from the economic and structural losses associated with a natural disaster, the communities it affects also undergo a loss in social capital, which can affect perceptions, levels of trust, and social cohesion. This working paper examines the impact of a severe natural disaster (the heavy floods that affected large parts of Pakistan in 2010) on the social capital of disaster-stricken communities by conducting a series of behavioral experiments and household surveys three years afterward. It contributes to the current literature by combining household-level information with behavioral games and testing the impact of individual characteristics, perceptions, and external assistance on people’s private contribution toward a pool of public goods in a post-disaster setting. We find that social capital, measured by respondents’ contribution toward a public good, is positively associated with a higher number of floods experienced. However, for individuals living in the 2010 flood-affected communities, contributions decline with each successive experience. This suggests that the experience of a severe natural disaster has a negative effect on social capital compared to frequent experiences of mild natural disasters where social capital is positively affected.