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The Economic Growth Impact of Hurricanes: Evidence from U.S. Coastal Counties

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  • Eric Strobl

    (Ecole Polytechnique Paris)

Abstract

I estimate the impact of hurricane strikes on local economic growth rates. To this end, I assemble a panel data set of U.S. coastal counties' growth rates and construct a novel hurricane destruction index that is based on a monetary loss equation, local wind speed estimates derived from a physical wind field model, and local exposure characteristics. The econometric results suggest that a county's annual economic growth rate falls on average by 0.45 percentage points, 28%% of it due to richer individuals moving away from affected counties. I also find that the impact of hurricanes is netted out in annual terms at the state level and does not affect national economic growth rates at all. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 93 (2011)
Issue (Month): 2 (May)
Pages: 575-589

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Handle: RePEc:tpr:restat:v:93:y:2011:i:2:p:575-589

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  1. Toya, Hideki & Skidmore, Mark, 2007. "Economic development and the impacts of natural disasters," Economics Letters, Elsevier, Elsevier, vol. 94(1), pages 20-25, January.
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Citations

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Cited by:
  1. Ariel Belasen & Chifeng Dai, 2014. "When oceans attack: assessing the impact of hurricanes on localized taxable sales," The Annals of Regional Science, Springer, Springer, vol. 52(2), pages 325-342, March.
  2. Gabriel Felbermayr & Jasmin Gröschl, 2013. "Natürlich negativ: Der Wachstumseffekt von Naturkatastrophen," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, Ifo Institute for Economic Research at the University of Munich, vol. 66(19), pages 16-22, October.
  3. Deryugina, Tatyana, 2011. "The Role of Transfer Payments in Mitigating Shocks: Evidence From the Impact of Hurricanes," MPRA Paper 53307, University Library of Munich, Germany, revised 08 Aug 2013.
  4. Vasco M. CARVALHO & NIREI Makoto & SAITO Yukiko, 2014. "Supply Chain Disruptions: Evidence from the Great East Japan Earthquake," Discussion papers, Research Institute of Economy, Trade and Industry (RIETI) 14035, Research Institute of Economy, Trade and Industry (RIETI).
  5. Gabriel J. Felbermayr & Jasmin Gröschl, 2013. "Naturally Negative: The Growth Effects of Natural Disasters," CESifo Working Paper Series, CESifo Group Munich 4439, CESifo Group Munich.
  6. Yamamura, Eiji, 2011. "Public sector corruption and the probability of technological disasters," MPRA Paper 34833, University Library of Munich, Germany.
  7. van Bergeijk, P.A.G. & Lazzaroni, S., 2013. "Macroeconomics of natural disasters," ISS Working Papers - General Series, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague 50075, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
  8. Alexander S. Skorobogatov, 2014. "An Ongoing Reversal Of Fortune Among Russian Cities: City Age, Natural Resources, And Changing Spatial Income Distribution," HSE Working papers, National Research University Higher School of Economics WP BRP 60/EC/2014, National Research University Higher School of Economics.
  9. Yamamura, Eiji, 2013. "Impact of natural disasters on income inequality: Analysis using panel data during the period 1965 to 2004," MPRA Paper 45623, University Library of Munich, Germany.
  10. Martina Kirchberger, 2014. "Natural disasters and labour markets," CSAE Working Paper Series 2014-19, Centre for the Study of African Economies, University of Oxford.
  11. Guglielmo Barone & Sauro Mocetti, 2014. "Natural disasters, growth and institutions: a tale of two earthquakes," Temi di discussione (Economic working papers), Bank of Italy, Economic Research and International Relations Area 949, Bank of Italy, Economic Research and International Relations Area.
  12. Lazzaroni, S. & van Bergeijk, P.A.G., 2013. "Natural disasters impact, factors of resilience and development: A meta-analysis of the macroeconomic literature," ISS Working Papers - General Series, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague 554, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
  13. Anthony Murphy & Eric Strobl, 2010. "The impact of hurricanes on housing prices: evidence from U.S. coastal cities," Working Papers, Federal Reserve Bank of Dallas 1009, Federal Reserve Bank of Dallas.
  14. Blake Sisk & Carl Bankston, 2014. "Hurricane Katrina, a Construction Boom, and a New Labor Force: Latino Immigrants and the New Orleans Construction Industry, 2000 and 2006–2010," Population Research and Policy Review, Springer, Springer, vol. 33(3), pages 309-334, June.
  15. Kousky, Carolyn, 2012. "Informing Climate Adaptation: A Review of the Economic Costs of Natural Disasters, Their Determinants, and Risk Reduction Options," Discussion Papers, Resources For the Future dp-12-28, Resources For the Future.

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