2008; Mendelsohn etal. The dynamic analysis reveals that past tropical cyclones have a negative influence on the majority of sectors providing evidence for the no recovery hypothesis discussed in the literature. The authors find that after the 2008 Wenchuan Earthquake neighboring counties suffer from indirect negative growth effects due to changes within the manufacturing sectors. It . Tropical cyclones have the largest negative effect on the agriculture, hunting, forestry, and fishing aggregate compared to other sectoral aggregates. Therefore, they take 5-year averages of the number of affected people normalized by the total population as main explanatory variable. Based on damage estimates from EM-DAT, the authors find a negative effect for the agricultural and a positive effect for the industrial sector. Additionally, the lagged dependent variable controls for a sluggish adjustment to shocks of the individual sector input composition. Econ J 129(619):13271342, He S (2017) Randomization inference with Stata: a guide and software. In total, I exclude five country-year observations from my analysis: Dominican Republic 1979, Grenada 2004, Montserrat 1989, Myanmar 1977, and Saint Lucia 1980. 2018 Hurricane Florence: Facts, FAQs, and how to help Additionally, I cluster the standard errors at broader regional levels as a further robustness test. The build-back-better hypothesis describes a situation where natural disasters first trigger a downturn of the economy, which is then followed by a positive stimulus, leading to a higher growth path than in the pre-disaster period. Rev Econ Stat 93(2):575589, Strobl E (2012) The economic growth impact of natural disasters in developing countries: evidence from hurricane strikes in the Central American and Caribbean Regions. A tropical cyclone is a low pressure system that develops over tropical waters, characterized by high winds and heavy rain. Additionally, tropical cyclone intensity is measured by remote sensing methods and other meteorological measurements. A strong pressure gradient rapidly developed within the system as it headed west resulting in a category rating of 5 by 8 March. \end{array}\right. } Figure 8 also offers an explanation for the downturn of the mining and utilities (C&E) sector aggregate after some years, as shown in Fig. In the second test, I take the mean wind speed cubed \((S(mean)^3_{g,t})\) above 92 km/h per grid and year to calculate the \(damage_{i,t}\) (see Appendix Table 41 and Figs. Environmental impacts of Hurricane Florence flooding in eastern North How do tropical storms affect people and the environment? 2018; Elliott etal. 2019). The findings can help them to identify the sectors for which they must reduce disaster risk. Unraveling the Effects of Tropical Cyclones on Economic Sectors How did the tropical cyclone impact the people communities? 4. Given these positive demand effects, one may ask why a significant contemporaneous positive direct effect for the construction sector cannot be seen. How did tropical cyclone Florence impact the economy? Cyclone Nivar : A cyclone is a general term for a weather system in which winds rotate inwardly to an area of low atmospheric pressure. Nevertheless, it unveils the importance of the manufacturing sectors, as already demonstrated by their strong intersectoral connection in Fig. Tropical cyclones are large, cyclonically rotating wind systems that form over tropical or sub-tropical oceans and are mostly concentrated on months in summer or early autumn in both hemispheres (Korty 2013). (2012) use data from EM-DAT as main input for their explanatory variables. Tropical cyclones and climate change - Wikipedia High levels of moisture in the air and low wind sheer formed showers and thunderstorms. After controlling for country and time specific effects, my estimation approaches allow for a causal identification of the direct and indirect responses to tropical cyclones damages with only little assumption needed (Dell etal. Perhaps the most challenging task is to identify critical sectors that may be responsible for widespread spillover effects leading to substantial modifications in other sectors production input schemes. Stagnant water can cause the spread of disease, and transportation or communication infrastructure may have been destroyed, hampering clean-up and rescue efforts. In total, I extend this research area in three ways: First, I introduce a new objective damage measure that allows for sector specific exposure of tropical cyclones. Stat Softw Compon S352601. First, tropical cyclones frequently cause a surge in ocean waters causing sea . Int J Remote Sens 38(21):59926006, Mohan PS, Spencer N, Strobl E (2019) Natural hazard-induced disasters and production efficiency: moving closer to or further from the frontier? 2020), and, simultaneously, more people will be exposed to tropical cyclones. Springer, Dordrecht, New York, pp 481494, Chapter Florence was labeled a post-tropical cyclone at 5 a.m. on Tuesday, Sept. 18, according to the National Hurricane Center. To identify the causal effects of tropical cyclone intensity on sectoral per capita growth, I use the following set of regression equations, which constitutes my main specifications: where the dependent variable \(Growth_{i,t-1->t}^j\) is the annual value added per capita growth rate of sector j in country i. To be in line with the related growth literature, I estimate a further specification where I add a set of socioeconomic control variables (Islam 1995; Strobl 2012; Felbermayr and Grschl 2014). Second, I use this new damage data to analyze all (exposed) countries (84) to tropical cyclones worldwide, which allows me to obtain more generalizable results.Footnote 2 Third, I conduct a thorough assessment of the long-term sectoral influences of tropical cyclones, as there is evidence, that long-term effects on total GDP exist (Felbermayr and Grschl 2014; Hsiang and Jina 2014; Onuma etal. The word hurricane is only used in the Atlantic, Caribbean Sea, Gulf of Mexico, and eastern Pacific, for storms that sustain winds at or above 74 miles per hour. Figure 7 illustrates the connections of significant changes of the InputOutput coefficient together with the effect size relative to the sample average of the respective InputOutput coefficients in parentheses (in %) resulting from model 6. Older empirical studies suffer to a large extent from endogeneity problems in their econometric analysis because their damage data are based on reports and insurance data, such as the Emergency Events Database (EM-DAT). In order to examine tropical cyclones as exogenous weather shocks, I pursue a panel data approach with year and country fixed effects in a simple growth equation framework (Strobl 2012; Dell etal. Q J Econ 131(3):15431592, Berlemann M, Wenzel D (2018) Hurricanes, economic growth and transmission channels: empirical evidence for countries on differing levels of development. Moreover, I include time fixed effects \(\delta _t\) to account for time trends and other events common to all countries in the sample. The underlying tables are only included for the direct sectoral effects, while the robustness tables for the InputOutput analysis are available upon request. However, the country fixed effects partly control for this concern. This is a well-established method (Strobl 2012; Heinen etal. 2014). Queensland has 20% of Australia's sugar cane production, but . 2008), and for a cross-section of 153 countries (Toya & Skidmore 2007). Tropical cyclones only lead to a small number of production process changes with coefficients being relatively small. In the years following a tropical cyclone, the majority of sectors experience negative growth effects. For the agricultural sector, I use the fraction of exposed agricultural land, while for the remaining sectors, I use the gridded population. The gray areas represent the respective 95% confidence intervals and the red line indicates the respective (connected) cumulative point estimates. It would be tedious to show \(26\,\times \,26\) regression models, Fig. The sectoral GDP data originates from the United Nations Statistical Division (UNSD) (United Nations Statistical Division 2015b). During 5 February, a tropical low was located south of Bali, Indonesia. Since the sample period is reduced to 19902015 due to data availability, I re-estimated the regression model of the main specification 2 for the reduced sample of model 6. It rather points to the presence of (delayed) negative effects of tropical cyclones from which the sectors cannot recover. A study led by Kevin Reed, PhD, Assistant Professor in the School of Marine and Atmospheric Sciences (SoMAS) at Stony Brook University, and published in Science Advances, found that Hurricane. As tropical cyclones are exogenous to sectoral economic growth, the greatest threat to causal identification could arise by omitting important climatic variables that are correlated with tropical cyclones (Auffhammer etal. Admittedly, this will not fully solve potential endogeneity problems, and concerns about bad controls (Angrist & Pischke 2009) and over-controlling (Dell etal. 16 in Appendix A.5. Latent Heat and Its Impact on Tropical Cyclones. 4.2 demonstrates, this effect may be driven by less demand from the manufacturing sectors. This change can be regarded as reconstruction efforts, which is also reflected in the relatively rapid recovery of the agricultural sector aggregate in Fig. The Aftermath of Hurricane Florence | AIR Worldwide The weighted tropical cyclone damage variables are orthogonal to economic growth as well as the InputOutput coefficients, and the panel approach allows me to identify the causal effect. The storm will likely damage homes. The procedure is hierarchical and reaches from other official governmental publications over publications from other international organizations to the usage of data from commercial providers (United Nations Statistical Division 2015b). Tropical Cyclones | World Meteorological Organization Appendix A.6 first shows the results of the randomization tests, followed by coefficient plots that summarize the remaining specifications. The data are collected every year for as many countries and regions as possible.Footnote 11 The sample used in my analysis covers the 19702015 period and includes a maximum of 205 countries.Footnote 12, To analyze potential sectoral shifts within the economy after a tropical cyclone, I take advantage of the InputOutput data of EORA26 (Lenzen etal. Each year the impacts of tropical cyclones and other weather, climate and water extremes around the Earth give rise to multiple casualties and significant damage to property and infrastructure, with adverse economic consequences for communities that can persist for many years. Nature 455(7209):9295, Emanuel K (2011) Global warming effects on U.S. hurricane damage. For the latitude and longitude the model takes a spline interpolation, whereas for intensity and time observations it uses a linear interpolation. Answer in Physical geography for Phophi #301640 The different colors represent different average coefficients, ranging from 0 (light purple) to 0.24 (dark purple). To the best of my knowledge, this is the first paper that analyzes global sectoral interactions after the occurrence of a tropical cyclone. (Color figure online). Originally a low-pressure system north of the Gulf of Carpentaria, Ingrid moved eastward and developed into a tropical cyclone in the Coral Sea on 6 March 2005. 2632). (2012) demonstrate that only the agricultural sector is negatively affected. Notes The y-axis displays the cumulative coefficient of tropical cyclone damage on the respective per capita growth rates, and the x-axis shows the years since the tropical cyclone passed. In this respect, the results of this research can also be used to calculate the future costs of climate change. In the years following the tropical cyclone, the efforts should be broadened to support the mining, and utilities, and the transport, storage, and communication sectors. My results indicate that this negative aggregate effect can be attributed to two sectoral aggregates, including agriculture, hunting, forestry, and fishing; manufacturing and wholesale, retail trade, restaurants, and hotels. Google Scholar, Auffhammer M, Hsiang SM, Schlenker W, Sobel A (2013) Using weather data and climate model output in economic analyses of climate change. Country-year observations above two standard deviations are labeled with the respective ISO3 code. However, to control for possible rainfall damage, I conduct a robustness test which includes a variable for precipitation (see Appendix Table 24 and and Figs. Climate change will lead to fewer tropical cyclones overall. Note that InputOutput coefficients can only range between 0 and 1. www.emdat.be, Haimes YY, Jiang P (2001) Leontief-based model of risk in complex interconnected infrastructures.
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