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Macroeconomic Spillovers of Weather Shocks Across U.S. States

Author

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  • Emanuele Bacchiocchi
  • Andrea Bastianin
  • Graziano Moramarco

Abstract

We estimate the short‐run effects of weather‐related disasters on local economic activity and cross‐border spillovers that operate through economic linkages between U.S. states. To this end, we use emergency declarations triggered by natural disasters and estimate their effects using a monthly global vector autoregressive (GVAR) model for U.S. states. Impulse responses highlight the nationwide effects of weather‐related disasters that hit individual regions. Taking into account economic linkages between states allows capturing much stronger spillovers than those associated with mere spatial proximity. The results underscore the importance of geographic heterogeneity for impact evaluation and the critical role of supply‐side propagation mechanisms.

Suggested Citation

  • Emanuele Bacchiocchi & Andrea Bastianin & Graziano Moramarco, 2026. "Macroeconomic Spillovers of Weather Shocks Across U.S. States," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 88(1), pages 141-156, February.
    • Handle: RePEc:bla:obuest:v:88:y:2026:i:1:p:141-156
    DOI: 10.1111/obes.70011
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    Cited by:

    1. is not listed on IDEAS
    2. Foroni, Claudia & Gelain, Paolo & Lorusso, Marco & Marcellino, Massimiliano, 2026. "Severe Weather and Financial (In)stability," CEPR Discussion Papers 21213, Centre for Economic Policy Research.
    3. Kumar, Naveen & Maiti, Dibyendu, 2025. "Climate change, state capacity and uneven growth: A disaggregated analysis of India," Economic Modelling, Elsevier, vol. 153(C).
    4. Claudia Foroni Paolo Gelain Marco Lorusso Massimiliano Marcellino, 2026. "Severe Weather and Financial (In)stability," BAFFI CAREFIN Working Papers 26266, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.

    More about this item

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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