The Effects of Disaster Damage on Budget Execution Inefficiency in Local Governments : Focusing on Organizational Learning = 재난피해가 예산 집행 비효율에 미치는 영향: 조직학습을 중심으로

다국어 초록 (Multilingual Abstract)

This study examines how disaster damage and organizational learning are associated with budget execution inefficiency in local governments. As the frequency and magnitude of natural disasters have increased in recent years, fiscal management in disaster response has emerged as a critical policy issue for local governments. While prior studies have primarily focused on the effects of disasters on expenditure levels or fiscal sustainability, relatively limited attention has been paid to how disaster experience translates into inefficiencies during the budget execution process, or to whether such inefficiencies can be conditioned by organizational learning.
Against this backdrop, this study conceptualizes disasters not as purely exogenous shocks, but as cumulative experiences that may exert lasting influence on local governments’ fiscal operations and budget execution structures. The primary objective of this study is to examine whether the accumulation of disaster damage is associated with increased budget execution inefficiency, and whether organizational learning—understood as an institutional form of learning—plays a conditional role in moderating this relationship.
Using panel data from 220 basic local governments (cities, counties, and districts) in South Korea over the period from 2008 to 2023, this study employs fixed-effects panel regression models. Disaster damage is measured using both absolute cumulative losses and relative concentration compared to the national average. Organizational learning is operationalized as double-loop learning at the institutional level, captured through revisions to disaster-related funds and disaster management legislation. Budget execution inefficiency is measured based on contingency reserve execution outcomes and is disaggregated into budget underutilization and overspending.
The empirical results suggest that the accumulation of absolute disaster damage is positively associated with budget execution inefficiency. This finding indicates that repeated disaster experiences may increase administrative and fiscal burdens, thereby exacerbating inefficiencies in the budget execution process. At the same time, when institutional learning related to disaster funds is present, the relationship between disaster damage and budget execution inefficiency appears to be attenuated. However, this moderating effect is not consistently observed when disaster damage is measured as a relative indicator. Moreover, the effects of organizational learning vary across types of budget execution inefficiency. While the impact of organizational learning is limited in models focusing on budget underutilization, organizational-level double-loop learning is, on average, associated with a restraining effect on overspending. Nevertheless, under conditions of large-scale disaster damage, this constraining effect appears to weaken or potentially reverse.
By linking disaster management and public finance through the lens of budget execution, this study contributes to a more nuanced understanding of the fiscal consequences of disaster experience. The findings further suggest that the effects of organizational learning are context-dependent, varying with the scale of disaster damage and the type of budget execution inefficiency. These results underscore the importance of interpreting institutional learning effects in disaster contexts with caution, while highlighting the need for further research on the dynamic interactions among disasters, organizational learning, and fiscal governance.

국문 초록 (Abstract)

본 연구는 재난피해와 조직학습이 지방정부의 예산 집행 비효율에 어떠한 방식으로 영향을 미치는지를 실증적으로 분석한다. 최근 자연재난의 빈도와 피해 규모가 증가함에 따라, 재난 대응 과정에서의 재정 운용은 지방정부의 핵심 정책 과제로 부각되고 있다. 기존 연구들은 주로 재난이 재정지출 규모나 재정 건전성에 미치는 영향에 주목해 왔으나, 재난 경험이 예산 집행 과정에서 발생하는 비효율로 어떻게 전이되는지, 그리고 이러한 비효율이 조직 차원의 학습을 통해 조정될 수 있는지에 대해서는 상대적으로 제한적인 논의가 이루어져 왔다.
이러한 문제의식에 기반하여 본 연구는 재난을 단순한 외생적 충격으로 보기보다는, 반복되는 경험을 통해 지방정부의 재정 운영과 예산 집행 구조에 누적적인 영향을 미치는 요인으로 이해한다. 특히 재난피해의 누적이 예산 집행 비효율을 증대시키는지 여부와, 제도적 학습으로서의 조직학습이 이러한 효과를 완화하거나 조정하는 조건부 역할을 수행하는지를 분석하는 데 목적을 둔다.
분석을 위해 본 연구는 2008년부터 2023년까지의 기간을 대상으로 대한민국 시·군·구 기초자치단체 220개를 분석 단위로 설정하고, 패널 고정효과모형을 활용하였다. 재난피해는 절대적 누적 피해 규모와 전국 평균 대비 상대적 집중도를 모두 고려하여 측정하였으며, 조직학습은 재난기금 및 재난 대응과 관련된 법령 개정을 통해 제도적 차원의 이중순환학습으로 조작화하였다. 예산 집행 비효율은 예비비 집행 결과를 기준으로 불용액과 과다지출로 구분하여 분석하였다.
분석 결과, 절대적 재난피해의 누적은 예산 집행 비효율을 유의미하게 증가시키는 경향이 관찰되었다. 이는 반복적인 재난 경험이 지방정부의 행정적·재정적 부담을 가중시켜 예산 집행 과정의 비효율을 확대할 가능성을 시사한다. 한편 재난기금 관련 법령 개정으로 측정된 조직학습이 존재하는 경우, 재난피해와 예산 집행 비효율 간의 관계는 일정 부분 완화되는 것으로 나타났다. 그러나 이러한 조절 효과는 재난피해를 상대적 지표로 측정한 경우에는 일관되게 관찰되지 않았으며, 조직학습의 효과는 예산 집행 비효율의 유형에 따라 상이하게 나타났다. 구체적으로 불용액을 종속변수로 한 분석에서는 조직학습의 효과가 제한적으로 나타난 반면, 과다지출을 대상으로 한 분석에서는 조직 차원의 이중순환학습이 평균적으로 과다지출을 억제하는 방향으로 작동하는 것으로 관찰되었다. 다만 대규모 재난 상황에서는 이러한 억제 효과가 약화되거나 역전될 가능성도 함께 확인되었다.
본 연구는 재난관리와 공공재정 연구를 예산 집행이라는 구체적 과정에서 연결함으로써, 재난 경험이 재정 운영 성과에 미치는 영향을 보다 입체적으로 이해하는 데 기여한다. 또한 조직학습의 효과가 재난피해의 규모와 예산 집행 비효율의 유형에 따라 맥락 의존적으로 나타남을 보여줌으로써, 재난 대응 과정에서 제도적 학습의 역할을 보다 신중하게 해석할 필요성을 시사한다.

목차 (Table of Contents)

• Chapter 1. Introduction 1
• 1.1. Background of the study: Disaster Response Budgets in Political and Administrative Contexts 1
• 1.2. Prior Research and the Research Gap 2
• 1.3. Organizational Learning and Disaster-Related Budget Execution 2
• 1.4. Purpose of the Study and Research Questions 3
• 1.5. Scope of the Study and Structure of the Dissertation 4
• Chapter 2. Theoretical Background 5
• 2.1. Definition of Disaster 5
• 2.2. Legal Foundations of Disaster Management in Korea 6
• 2.2.1. Institutional Structure of Disaster Management in Korea 7
• 2.2.2 Functional Overlap and Duplication in Disaster Governance 8
• 2.2.3 Discussions on Disaster-Related Public Funds 12
• 2.3. Organizational Learning 14
• 2.4. Redundancy 16
• 2.4.1. Bureaucratic Redundancy and institutional layering 17
• Chapter 3. Literature Reviews 19
• 3.1. The Relationship between Disasters and Government Finance 19
• 3.2. The Relationship between Redundancy and Efficiency 20
• 3.3. Organizational Learning from Disasters 21
• 3.3.1. Double-Loop Learning in the Public Sector 22
• Chapter 4. Research Design 24
• 4.1. Data and sample 24
• 4.2. Variables 24
• 4.2.1. Outcome Variable 25
• 4.2.2. Explanatory Variable 25
• 4.2.3. Control Variables 27
• 4.3. Methods 28
• Chapter 5. Results 29
• 5.1. Fixed-effect results for fiscal inefficiency (Study 1) 31
• 5.1.1. Model diagnostics and robustness 33
• 5.2. Fixed effect results for Underutilization and Overusing (Study 2) 36
• 5.2.1. Outcome variable for Underutilization 36
• 5.2.2. Outcome variable for Overusing 39
• Chapter 6. Discussion and Conclusion 40
• 6.1. Summary and Interpretation of Main Findings 40
• 6.2. Theoretical Contributions 43
• 6.3. Policy Implications 44
• 6.4. Limitation 45
• 6.5. Conclusion 49
• Bibliography 52
• List of Tables
• Table 1. Institutional Structure of Korea’s Multi-level Disaster Management System Based on the Framework Act on the Management of Disasters and Safety 12
• Table 2. Description of the main variables 27
• Table 3. Descriptive analysis of Variables 29
• Table 4. Fixed effect model analysis with outcome variable inefficiency. 33
• Table 5. Fixed effect model analysis with outcome variable Underutilization 36
• Table 6. Fixed effect model analysis with outcome variable Overusing 39
• List of Figures
• Figure 1. Framework of Disaster Management in Korea government (Reconstructed based on the definition of natural disasters and disaster management framework in Ministry of Government Legislation of the Republic of Korea.) 8
• Figure 2. Scatter plot of Residual for Model 2 (using total disaster damage) 33
• Figure 3. Scatter plot of Residual for Model 4 (using Relative disaster damage) 34
• Figure 4. Marginal Effects of Cumulative Disaster Damage on Budget Inefficiency 40
• Figure 5. Moderating Effect of Double-Loop Learning (Disaster Funds) on the Relationship between Cumulative Disaster Damage and Budget Inefficiency 43