Laura A. Bakkensen
University of Arizona
School of Government & Public Policy
315 Social Science
P.O. Box 210027
Tucson, AZ 85721-0027
Institutional Affiliation: University of Arizona
NBER Working Papers and Publications
|August 2018||Climate Shocks, Cyclones, and Economic Growth: Bridging the Micro-Macro Gap|
with : w24893
Empirical analyses of climatic event impacts on growth, while critical for policy, have been slow to be incorporated into macroeconomic climate-economy models. This paper proposes a joint empirical-structural approach to bridge this gap for tropical cyclones. First, we review competing empirical approaches in a harmonized global dataset and through a theory lens. Second, we estimate cyclone impacts on structural determinants of growth (productivity, depreciation, fatalities) to quantify a stochastic growth model for 40 vulnerable countries and project welfare effects of climate-driven cyclone risk changes. Third, we compute cyclone impacts on the social cost of carbon in the seminal DICE model.
|September 2017||Flood Risk Belief Heterogeneity and Coastal Home Price Dynamics: Going Under Water?|
with : w23854
How do climate risk beliefs affect coastal housing markets? This paper provides theoretical and empirical evidence. First, we build a dynamic housing market model and show that belief heterogeneity can reconcile the mixed empirical evidence on flood risk capitalization into housing prices. Second, we implement a field survey in Rhode Island. We find significant heterogeneity and sorting based on flood risk perceptions and amenity values. Third, we calibrate the model and estimate that coastal prices currently exceed fundamentals by 10%. Ignoring heterogeneity leads to a four-fold underestimate of future coastal home price declines due to sea level rise.