Get access

The Political Economy of FEMA Disaster Payments

Authors

  • Thomas A. Garrett,

    1. Senior Economist, Research Division, Federal Reserve Bank of St. Louis, St. Louis, MO 63102. Phone 1–314–444–8601, Fax 1–314–444–8731, E-mail tom.a.garrett@stls.frb.org
    Search for more papers by this author
  • Russell S. Sobel

    1. Associate Professor, Department of Economics, West Virginia University, Morgantown, WV 26506. Phone 1–304–293–7864, Fax 1–304y293–5652, E-mail rsobel2@wvu.edu
    Search for more papers by this author
    • *

      An earlier version of this article was presented at the 2001 Public Choice Society meetings in San Antonio, Texas, and the 2001 Southern Economic Association annual meetings in Tampa, Florida. We have benefited from the helpful comments of an anonymous referee of this journal and discussions with Daniel Sutter, Jacob Gersen, John Charles Bradbury, and Brian Knight, as well as other program participants. Remaining errors are our responsibility. The views expressed here are those of the authors and do not necessarily reflect official positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors.


Abstract

We find that presidential and congressional influences affect the rate of disaster declaration and the allocation of FEMA disaster expenditures across states. States politically important to the president have a higher rate of disaster declaration by the president, and disaster expenditures are higher in states having congressional representation on FEMA oversight committees. Election year impacts are also found. Our models predict that nearly half of all disaster relief is motivated politically rather than by need. The findings reject a purely altruistic model of FEMA assistance and question the relative effectiveness of government versus private disaster relief.

Ancillary