The Impact of Hurricane Strikes on Short-Term Local Economic Activity: Evidence from Nightlight Images in the Dominican Republic

28 Pages Posted: 16 Dec 2017

See all articles by Oscar Ishizawa

Oscar Ishizawa

World Bank

Juan Jose Miranda

World Bank

Eric Strobl

Ecole Polytechnique, Paris - Department of Economic Sciences; IZA Institute of Labor Economics

Date Written: December 14, 2017

Abstract

The Dominican Republic is highly exposed to adverse natural events putting the country at risk of losing hard-won economic, social, and environmental gains due to the impacts of disasters. This study uses monthly nightlight composites in conjunction with a wind field model to econometrically estimate the impact of tropical cyclones on local economic activity in the Dominican Republic since 1992. It is found that the negative impact of storms lasts up to 15 months after the strike, with the largest effect observed after nine months. Translating the reduction in nightlight intensity into monetary losses by relating it to quarterly gross domestic product suggests that on average the storms reduced gross domestic product by about US$1.1 billion (4.5 percent of gross domestic product in 2000 and 1.5 percent in 2016).

Keywords: Technology Industry, Technology Innovation, Disaster Management, Social Risk Management, Hazard Risk Management, Adaptation to Climate Change

Suggested Citation

Ishizawa, Oscar and Miranda, Juan Jose and Strobl, Eric, The Impact of Hurricane Strikes on Short-Term Local Economic Activity: Evidence from Nightlight Images in the Dominican Republic (December 14, 2017). World Bank Policy Research Working Paper No. 8275, Available at SSRN: https://ssrn.com/abstract=3088318

Oscar Ishizawa (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Juan Jose Miranda

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States

Eric Strobl

Ecole Polytechnique, Paris - Department of Economic Sciences ( email )

Ecole Polytechnique
Department of Economics
Paris, 75005
France

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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