Impact of the Great East Japan Earthquake on the oyster market: a difference-in-differences estimation

This paper uses prefecture-level data during 1970–2015 to examine the impact of the Great East Japan Earthquake on the oyster market in Japan. Using a difference-in-differences estimation, we find that the disaster decreased the oyster production by 65%. This negative effect peaked in 2012, but did not completely disappear 4 years after the disaster. In contrast, we find that oyster prices only increased by 26%, and the parameter estimate is only marginally significant. Moreover, this impact is relatively constant over time. The apparent lack of price changes corresponding to large production changes can be caused by three factors: elastic demand, market integration, and demand shocks. We examine each possibility and conclude that the demand shocks due to the concern for radioactive contamination is the most likely cause of the small impact on oyster prices.