This paper identifies institutional failure as the root cause for underdevelopment and susceptibility to disasters and explores their interdependent relationship. It is demonstrated that only if a country's governance structure enables the implementation and enforcement of public policies conducive to a country's economic and social development can sustainable livelihoods be achieved and susceptibility to disasters be reduced. Accountability, participation, predictability and transparency are identified as the key features of a governance structure that fosters development and supports risk reduction.
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