Does Government Capacity Mitigate Natural Disaster Impacts and Lower Resilience Costs?: Evidence From South Korea's Regional Local Government

ABSTRACT This study examines the impact of local government capacity on mitigating natural disaster damage and reducing resilience costs in South Korea from 2014 to 2023. Recognizing the multidimensional nature of administrative capacity, we categorized independent variables into technical capacity, local administration, policy, institutional and financial capacities. Using Panel‐Corrected Standard Errors (PCSE) and Panel Tobit regression models, the empirical findings revealed that a higher ratio of residents per firefighter and public official was associated with a decrease in natural disaster damage. Conversely, the enactment of disaster and safety ordinances and the accumulation of disaster management funds were found to correlate with an increase in damage. These results underscore the critical need for strategic disaster management tailored to local communities in response to increasingly large‐scale and uncertain natural disasters. Our findings suggest that local governments should optimally allocate disaster management personnel and public officials based on the specific characteristics of each community to ensure effective and strategic disaster management aimed at mitigating natural disaster damage and reducing resilience costs in South Korean communities. Additionally, South Korean communities should enhance the practical effectiveness of disaster and safety ordinances along with the utility of disaster management funds to substantially reduce disaster damage and resilience costs. This necessity suggests that building disaster management capacity should prioritize qualitative improvements including the effective implementation of disaster management and timely fund execution rather than mere quantitative expansion to achieve a practical reduction in disaster impacts and resilience costs. Ultimately, this research confirms that managing the technical, administrative, institutional and financial capacities of South Korean local governments is essential for reducing natural disaster damage and resilience costs. Specifically, the empirical findings demonstrate that when local governments secure strategic management capacity, particularly regarding the practical effectiveness of institutions and funds related to disasters along with administrative responsiveness, they can substantially mitigate natural disaster damage and reduce resilience costs within their communities.