LEARNING EFFECT AND SOCIAL CAPITAL: A CASE STUDY OF NATURAL DISASTER FROM JAPAN

Using Japanese prefecture level data for the years between 1988 and 2001, this paper explores how and the extent to which social capital has an effect on the damage resulting from natural disasters. It also examines whether the experience of a natural disaster affects individual and collective protection against future disasters. Using regression analysis and controlling for various factors such as the proportion of poor people, per capita income, and the number of natural disasters, there are three major findings. (1) Social capital reduces the damage caused by natural disasters. (2) The risk of a natural disaster makes people more apt to cooperate and therefore social capital is more effective to prevent disasters. (3) Economic conditions such as the level of income distinctly affect any damage, but hardly influence it when the scale of a disaster is small.