Does Governmental Assistance Affect Private Decisions to Insure? An Empirical Analysis of Flood Insurance Purchases
研究了联邦紧急事务管理局的公共援助项目如何影响家庭购买洪水保险，发现援助增加会降低保险购买率，揭示了公共灾害救助的挤出效应及其隐性社会成本。
In this paper, we empirically examine whether the Federal Emergency Management Agency’s Public Assistance (PA) program, which targets postdisaster cleanup and infrastructure rehabilitation, affects household purchases of flood insurance. Using the fixed-effects model with instrumental variables to address the endogeneity of disaster aid, we find that increased PA grants reduce a county’s flood insurance take-up rates, thereby driving down its total insurance coverage and premiums paid. Our findings provide empirical evidence on the crowding-out effect of public disaster programs, and shed light on their implicit social costs and increased federal financial exposure to natural disasters and climate change. <i></i>