Floods and firms: vulnerabilities and resilience to natural disasters in Europe
JRC Working Papers in Economics and Finance, 2022/13
Exploiting data on historical natural hazards, granular flood risk maps and firm geolocalisation, we study the dynamic impacts of floods on European manufacturing firms during the period 2007-2018. We find that water damages significantly and persistently worsen firm performance, and may endanger firm survival. An average flood deteriorates total assets by about 2% in the year after the event, and up to 5% seven years out. The average drop in sales and employment is comparable. We show how reallocation of economic activity within flooded regions can reconcile our results with the 'creative destruction' hypothesis proposed by the natural disaster literature.
FATICA Serena;
KATAY Gabor;
RANCAN Michela;
2022-12-19
European Commission
JRC132125
https://publications.jrc.ec.europa.eu/repository/handle/JRC132125,
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