Climate Change Brings Stormy Days: Case Studies on the Impact of Extreme Weather Events on Public Finances

18 Pages Posted: 2 Feb 2012

See all articles by Martin Heipertz

Martin Heipertz

European Central Bank - International and European Relations

Christiane Nickel

European Central Bank (ECB)

Date Written: April 3, 2008

Abstract

This paper explores some implications of climate change for fiscal policies by assessing the impact of extreme weather events on public budgets. It presents selected case studies on the basis of available data for extreme weather events in the EU and the US that have occurred since 1990. We derive estimates for the budgetary impact of such events on the basis of the estimated economic damage and with respect to public relief payments. Based on these, we discuss implications for fiscal policy and publicly-provided disaster insurance. Our policy conclusions point to the enhanced need to reach and maintain sound fiscal positions given that climate change is expected to cause an increase in the number and severity of natural disasters.

Keywords: global warming, climate change, fiscal sustainability, disasters

JEL Classification: Q54, Q58, F59, H87

Suggested Citation

Heipertz, Martin and Nickel, Christiane, Climate Change Brings Stormy Days: Case Studies on the Impact of Extreme Weather Events on Public Finances (April 3, 2008). Available at SSRN: https://ssrn.com/abstract=1997256 or http://dx.doi.org/10.2139/ssrn.1997256

Martin Heipertz (Contact Author)

European Central Bank - International and European Relations ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Christiane Nickel

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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