Spatial Dependencies in Wind-Related Housing Damage

26 Pages Posted: 24 Nov 2004 Last revised: 9 May 2015

See all articles by Dakshina G. De Silva

Dakshina G. De Silva

Department of Economics, Lancaster University Management School

Jamie Brown Kruse

affiliation not provided to SSRN

Yongsheng Wang

Washington & Jefferson College

Date Written: November 8, 2004

Abstract

This paper examines the spatial dependence among housing losses due to tornadoes using data from the May 1999 Oklahoma City tornado. In order to examine the existence of spatial dependence and its impacts on the damage analysis, we compare an estimation based on a traditional ordinary least square model with the general spatial model. The results show that housing damage in this disaster area is highly correlated. Monetary losses not only depend on the tornado that struck residences, but are related to the damage magnitudes of neighboring houses. Average losses as well as the loss ratio increase with the Fujita scale damage rating. We conclude that the general spatial model provides unbiased estimates compared to the ordinary least square model.

Keywords: Housing damage, spatial dependence, tornado, fujita scale

JEL Classification: R19, Q54

Suggested Citation

De Silva, Dakshina G. and Kruse, Jamie Brown and Wang, Yongsheng, Spatial Dependencies in Wind-Related Housing Damage (November 8, 2004). Available at SSRN: https://ssrn.com/abstract=619841 or http://dx.doi.org/10.2139/ssrn.619841

Dakshina G. De Silva

Department of Economics, Lancaster University Management School ( email )

Lancaster LA1 4YX
United Kingdom

Jamie Brown Kruse

affiliation not provided to SSRN ( email )

Yongsheng Wang (Contact Author)

Washington & Jefferson College ( email )

Department of Economics
60 South Lincoln St.
Washington, PA 15301
United States
724-223-6156 (Phone)
724-223-5271 (Fax)

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