The Impact of Typhoons on Economic Activity in the Philippines: Evidence from Nightlight Intensity

28 Pages Posted: 4 May 2020

See all articles by Eric Strobl

Eric Strobl

Ecole Polytechnique, Paris - Department of Economic Sciences; IZA Institute of Labor Economics

Date Written: July 30, 2019

Abstract

We quantify the economic impact of typhoons in the Philippines. To this end we construct a panel data set of local economic activity derived from nightlight intensity satellite images and a cell level measure of typhoon damage constructed from storm track data, a wind field model, and a stylized damage function. Our econometric results reveal that there is a statistically and potentially economically significant, albeit short- lived, impact of typhoon destruction on local economic activity. Constructing risk profiles from a 60-year historical set of storms suggests that (near) future losses in economic activity for frequent (5-year return period) and rare (50-year return period) events are likely to range from between 1.0% and 2.5%.

Keywords: economic impact, nightlights, Philippines, typhoons, wind field model

JEL Classification: O17, O44, Q54

Suggested Citation

Strobl, Eric, The Impact of Typhoons on Economic Activity in the Philippines: Evidence from Nightlight Intensity (July 30, 2019). Asian Development Bank Economics Working Paper Series No. 589, Available at SSRN: https://ssrn.com/abstract=3590202 or http://dx.doi.org/10.2139/ssrn.3590202

Eric Strobl (Contact Author)

Ecole Polytechnique, Paris - Department of Economic Sciences ( email )

Ecole Polytechnique
Department of Economics
Paris, 75005
France

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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