Measuring the Effects of Humanitarian Operations on Economic Performance

ABSTRACT This essay uses event study methodology to demonstrate the economic impact of Federal Emergency Management Agency (FEMA) disaster recovery operations. The results indicate that the Individual & Households programme, which reimburses individual losses, has the greatest positive effect on economic growth, and the impact is seen 2 years after the disaster hits. It is shown that more money spent through FEMA has a positive effect on economic recovery but it is not seen until 2 years after a disaster and that the time it takes for the government to declare a disaster, to activate FEMA response, has long‐term economic effects.