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The Effect of Natural Disasters on Economic Activity in US Counties: A Century of Data

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  • Leah Platt Boustan
  • Matthew E. Kahn
  • Paul W. Rhode
  • Maria Lucia Yanguas
Abstract
More than 100 natural disasters strike the United States every year, causing extensive fatalities and damages. We construct the universe of US federally designated natural disasters from 1920 to 2010. We find that severe disasters increase out-migration rates at the county level by 1.5 percentage points and lower housing prices/rents by 2.5–5.0 percent. The migration response to milder disasters is smaller but has been increasing over time. The economic response to disasters is most consistent with falling local productivity and labor demand. Disasters that convey more information about future disaster risk increase the pace of out-migration.

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  • Leah Platt Boustan & Matthew E. Kahn & Paul W. Rhode & Maria Lucia Yanguas, 2017. "The Effect of Natural Disasters on Economic Activity in US Counties: A Century of Data," NBER Working Papers 23410, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:23410
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    JEL classification:

    • N42 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: 1913-
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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