Households after a natural disaster

The CMIE's CPHS data breaks the preconception of devastation and impoverished households being pushed to spending less

Recent research has uncovered new insights into a major natural disaster, the Chennai floods of 2015. Curiously, there was not much of a change in household income. But household expenditure surged for about a year after the floods. There were sharp increases in expenses on health and on fuel/power. After this period, households reversed themselves and started spending less; they were probably repairing their balance sheets. The expenditure surge was smaller for the less affluent, even though the damage that they suffered is likely to have been worse. More access to borrowing would have helped.

Natural disasters are important phenomena in