The impact of tropical storms on tax revenue

Mohan, Preeya; Strobl, Eric

doi:10.1002/jid.3538

Cited by 8 publications

(3 citation statements)

References 40 publications

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“…Additionally, specialized international insurance programs can be developed, such as the Caribbean Catastrophe Risk Insurance Facility. Such measures are particularly important for Eastern Caribbean SIDS, which face limited fiscal space and domestic finance for climate adaptation and mitigation at the same time as the high-income status of the majority of these countries makes access to international finance challenging (Mohan, 2022, andStrobl, 2021). Notes: (a) * * * and * * 1 and 5 percent significance levels, respectively; (b) all regressions include year and month dummy indicators; (c) regression error terms clustered at country level.…”

Section: Discussionmentioning

confidence: 99%

The Impact of Tropical Storms on International Trade: Evidence from Eastern Caribbean Small Island Developing States

Mohan

2023

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Eastern Caribbean Small Island Developing States (SIDS) have a high dependence on international trade for income, employment and poverty reduction given their extreme openness, small market size, narrow range of resources and productive capabilities and specialized economic structures, making them vulnerable to external shocks, the most frequent being tropical storms. The objective of this paper is to investigate the impact of tropical storms on international trade for eight Eastern Caribbean SIDS over the period 2000-2019, as well as the mediating role of the Real Effective Exchange Rate (REER). The results indicate that hurricanes have a more long-term impact on exports, reducing exports of goods by 20 percent in the month of a strike and up to three months thereafter, while the impact on imports was just as severe but more immediate, reducing imports of goods by 11 percent in the month of a strike. The mediation analysis suggests that the REER plays no mediating role in explaining the impact of tropical storm damage on exports and imports in the region.

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Section: Discussionmentioning

confidence: 99%

The Impact of Tropical Storms on International Trade: Evidence from Eastern Caribbean Small Island Developing States

Mohan

2023

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“…Extreme weather events like tropical cyclones, floods, and heavy precipitation can have severe impacts on economies, leading to a short-term deterioration of several macro-economic variables. In the Caribbean region, for example, an average hurricane strike was found to cause an annual growth loss of about 0.84% 1 , a local income growth loss of 1.5% 2 , a total tax revenue loss of 5.3% 3 , a multifold increase in monthly average inflation 4 , and an appreciation of real exchange 5 .…”

Section: Introductionmentioning

confidence: 99%

“…These deteriorated macro-economic scenarios are likely to require increases in government spendings 6 via short-term deficit financing, which in turn leads to debt increase 3 . For countries facing pre-existing debt sustainability issues this may be very costly 7 and, therefore, their recovery often relies on financial aid from international donors acting as insurers of last resort.…”

Section: Introductionmentioning

confidence: 99%

Increasing countries’ financial resilience through global catastrophe risk pooling

et al. 2023

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Extreme weather events can severely impact national economies, leading the recovery of low- to middle-income countries to become reliant on foreign financial aid. Foreign aid is, however, slow and uncertain. Therefore, the Sendai Framework and the Paris Agreement advocate for more resilient financial instruments like sovereign catastrophe risk pools. Existing pools, however, might not fully exploit their financial resilience potential because they were not designed to maximize risk diversification and because they pool risk only regionally. Here we introduce a method that forms pools by maximizing risk diversification and apply it to assess the benefits of global pooling compared to regional pooling. We find that global pooling always provides a higher risk diversification, it better distributes countries’ risk shares in the pool’s risk and it increases the number of countries profiting from risk pooling. Optimal global pooling could provide a diversification increase to existing pools of up to 65 %.

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Are Disaster Impact Estimates Distorted by Errors in Popular Night-Time Lights Data?

Gibson,

Jiang,

Zhang

et al. 2024

EconDisCliCha

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Satellite-detected night lights data are widely used to evaluate economic impacts of disasters. Growing evidence from elsewhere in applied economics suggests that impact estimates are potentially distorted when popular Defense Meteorological Satellite Program (DMSP) night lights data are used. The low resolution DMSP sensor provides blurred and top-coded images compared to those from the newer and more precise Visible Infrared Imaging Radiometer Suite (VIIRS) images. Despite this, some disaster impact studies continue to use DMSP data, which have also been given a new lease of life through the use of harmonized series linking DMSP and VIIRS data to provide a longer sample. We examine whether use of DMSP data affects evaluations, using expected typhoon damages in the Philippines from 2012–19 as our case study. With DMSP data, negative impacts on economic activity from expected damages at the municipality level appear over 50% larger than when the VIIRS data are used. The DMSP data give the appearance of greater spatial autocorrelation in luminosity and through this channel may tend to spread apparent spatial impacts of shocks. Harmonized data that adjust VIIRS images to be like the DMSP data also have this spurious autocorrelation so researchers should be cautious in using these data for disaster assessments.

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The impact of tropical storms on tax revenue

Cited by 8 publications

References 40 publications

The Impact of Tropical Storms on International Trade: Evidence from Eastern Caribbean Small Island Developing States

The Impact of Tropical Storms on International Trade: Evidence from Eastern Caribbean Small Island Developing States

Increasing countries’ financial resilience through global catastrophe risk pooling

Are Disaster Impact Estimates Distorted by Errors in Popular Night-Time Lights Data?

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