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Human Capital Investment after the Storm


  • Emily A Gallagher
  • Stephen B Billings
  • Lowell R Ricketts


How does household exposure to a natural disaster affect higher education investments? Using variation in flooding from Hurricane Harvey (2017), we find that college-aged adults from flooded blocks in Houston are 7% less likely than counterparts to have student loans after Harvey, with larger effects in areas with more potential first-generation students. We find a similar relative decline in enrollment at more exposed Texas universities and colleges and a shift toward majors with higher expected earnings. Our results highlight a decrease in the quantity but an increase in the intensity of investments in human capital after the storm.Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

Suggested Citation

  • Emily A Gallagher & Stephen B Billings & Lowell R Ricketts, 2023. "Human Capital Investment after the Storm," Review of Financial Studies, Society for Financial Studies, vol. 36(7), pages 2651-2684.
  • Handle: RePEc:oup:rfinst:v:36:y:2023:i:7:p:2651-2684.

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    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid


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