IDEAS home Printed from https://ideas.repec.org/a/ucp/jaerec/doi10.1086-710240.html

Climate Risk and Beliefs in New York Floodplains

Author

Listed:
  • Matthew Gibson
  • Jamie T. Mullins

Abstract

Applying a difference-in-differences framework to a census of residential property transactions in New York City 2003–17, we estimate the price effects of three flood risk signals: (1) the Biggert-Waters Flood Insurance Reform Act, which increased premiums; (2) Hurricane Sandy; and (3) new floodplain maps reflecting three decades of climate change. Estimates are negative for all three signals, and some are large: properties included in the new floodplain after escaping flooding by Sandy experienced 11% price reductions. We investigate possible mechanisms, including selection of properties into the market and residential sorting. Finding no evidence for these, we develop a parsimonious theoretical model that allows decomposition of our reduced-form estimates into the effects of insurance premium changes and belief updating. Results suggest the new maps induced belief changes comparable to those from insurance reform.

Suggested Citation

  • Matthew Gibson & Jamie T. Mullins, 2020. "Climate Risk and Beliefs in New York Floodplains," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 7(6), pages 1069-1111.
    • Handle: RePEc:ucp:jaerec:doi:10.1086/710240
    DOI: 10.1086/710240
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/710240
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: http://dx.doi.org/10.1086/710240
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/710240?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    More about this item

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jaerec:doi:10.1086/710240. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JAERE .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.