In a recent paper in REStat, Eric Strobl found that hurricanes did not increase economic growth in the U.S. Now he has a paper in the Journal of Development Economics that has similar findings for Latin American and Carribbean countries; the abstract:
In this paper we investigate the macroeconomic impact of natural disasters in developing countries by examining hurricane strikes in the Central American and Caribbean regions. Our innovation in this regard is to employ a wind field model on hurricane track data to arrive at a more scientifically based index of potential local destruction. This index allows us to identify damages at a detailed geographical level, compare hurricanes' destructiveness, as well as identify the countries that are most affected, without having to rely on potentially questionable monetary loss estimates. Combining our destruction index with macroeconomic data we show that the average hurricane strike caused output to fall by at least 0.83 percentage points in the region, although this depends on controlling for local economic characteristics of the country affected and what time of the year the storm strikes.Of course, Strobl and others could publish 50 papers with similar conclusions and it wouldn't stop some doofus from proclaiming that the aftermath of some hurricane or other disaster will be greater prosperity.
Tuesday, November 1, 2011
Paging M. Bastiat: "So Much for Hurricanes as Stimulus, Part Deux"
From Division of Labor: