Household-Level Recovery after Volcanic Eruptions in Indonesia: Empirical Evidence Based on an Asset-based Approach

Abstract

Employing the asset-based approach, this paper examines the household-level recovery of three household groups in the aftermath of the 2010 Mt. Merapi volcanic eruptions in Indonesia and the role of social protection programs. Based on a panel survey conducted in 2012, a total of 651 rural households were classified based on their different levels of disaster risk. Ordinary Least Square (OLS) was used to estimate recovery parameters. The study revealed that in regard to pre-eruptions productive assets, it is not only the extent of damage caused by the eruptions that determines a household's recovery but also the household's initial asset level. Households living in low risk areas that had the lowest level of productive assets experienced slower recovery even though they sustained only a modest level of damage. Raskin social protection program accelerated recovery for households in high risk areas. On the contrary, it decelerated recovery for households in medium risk areas. The findings of the study suggest that apart from the extent of eruptions damage, government must also consider the household's initial asset level when allocated aid for disaster affected households. Lowest assets households are more sensitive to shocks and experience slower recovery after hit by volcanic eruptions.