The 2011 Japanese Earthquake, Tsunami And Nuclear Crisis: Evidence Of Contagion From International Financial Markets
Natural disasters may inflict significant damage upon international financial markets. Using 33 international stock indexes and exchange rates, this paper examines if any contagion occurred across financial markets after the March 11, 2011 Japanese earthquake, tsunami and nuclear crisis. The results have two paramount implications. Firstly, the authors have confirmed existing consensus that in the face of natural crises that could take an international scale, emerging markets are contagiously affected for the most part. Secondly, they have also shown that international financial market transmissions not only occur during financial crisis; natural disaster effects should not be undermined.