Floods, Fire, and Extreme Heat
Lightning Round SessionSaturday, Jan. 3, 2026 10:15 AM - 12:15 PM (EST)
- Chair: Shifrah Aron-Dine, University of California-Berkeley
Vulnerable Markets: Impact of Extreme Flooding on Agriculture Supply Networks
Abstract
This paper studies how extreme climate shocks propagate through agricultural supply networks, using the 2022 floods in Pakistan as a natural experiment. We assemble novel administrative data on agricultural commodity arrivals at 36 regulated wholesale markets, tracing flows from 223 source regions, and link these records to high-resolution satellite measures of flood exposure constructed for this study. Our empirical strategy combines a staggered event-study design at production origins with a shift-share exposure framework at destination markets, allowing us to separately identify upstream production shocks, downstream market impacts, and network adjustment. We document three main results. First, flooding causes large and persistent supply losses: arrivals from flooded origins decrease by roughly 50 percent, and downstream market arrivals decline by up to 65 percent, particularly for perishable crops. Second, price adjustment is uneven across the supply chain: retail prices rise quickly and remain elevated, while wholesale prices respond more gradually, implying temporary increases in intermediary margins. Third, network structure shapes the incidence of the shock: the downstream supply collapse is disproportionately driven by disruptions to long-distance sourcing relationships, indicating that spatially extended supply links are especially vulnerable during large-scale floods. We further show that historically flood-prone origins exhibit anticipatory behavior and faster recovery, consistent with differential preparedness.Hot Heads: How Heat Shocks Affect Inventors' Productivity
Abstract
As global temperatures rise, understanding the economic consequences of climate change, particularly on labour productivity and long-term growth, is increasingly urgent. Temperature fluctuations are likely to affect workers unevenly due to variations in tasks, workplace environments, and adaptive capabilities. This paper investigates how elevated temperatures impact the productivity of inventors, a critical high-skilled group whose innovation significantly drives economic growth. Using inventor-level data from the United States between 2000 and 2020, we document a clear negative relationship between higher temperatures and patenting activity: each additional day above 20°C over the previous three years reduces an inventor's patent filings by approximately 0.12%. Our findings suggest that temperature shocks disrupt the cumulative innovation processes essential for sustained economic growth. This impact appears particularly pronounced in California, potentially due to lower air conditioning penetration, highlighting the importance of adaptation in mitigating climate-driven productivity losses.Stuck in the Fields: How Rising Temperatures Deepen Gender Inequality in Rural India
Abstract
This study highlights how rising temperatures due to climate change amplify gender inequality in developing countries. Using a rich district-level panel dataset from the Census (1991–2011) and household surveys (1987–2018), I examine how exogenous increases in long-term temperature levels in Indian districts impact gendered labor market outcomes in rural areas. The findings indicate that, in districts with a high share of poor, landless farmers belonging to backward caste groups, as agriculture becomes less productive and more volatile with increasing temperatures, men are transitioning from agriculture to non-agricultural sectors, primarily to the construction sector. In contrast, women stay put and are unable to shift sectors. Specifically, in these districts, a 1 degree C increase in long-term temperatures is associated with a 23.5% increase in the female-to-male employment ratio in the agricultural sector between 1991 and 2011.To interpret these results, I develop a theoretical framework and show how gender norms impose significant costs of transition on women and limit their sectoral mobility. The theoretical predictions are validated using both household surveys and qualitative fieldwork in rural India. The field interviews reveal that gender norms hinder women’s mobility through high commuting costs, such as the inability to travel alone and norms against riding bicycles or motorbikes. Poor public transport further exacerbates these challenges. Additionally, gender norms discourage women from entering certain non-agricultural occupations, such as construction. The interviews also uncover significant gender differences in perceptions. While women express a strong willingness to change sectors, men tend to underestimate their capabilities.
I explore additional mechanisms that can reinforce this pattern, including declines in rural-urban marriage migration among women, which increases the likelihood of their engagement in agriculture. Moreover, as women take on higher-valued agricultural tasks previously performed by men, their weak bargaining power results in lower wages and widens the gender wage gap.
Disasters, Capital, and Productivity
Abstract
Large disasters devastate economies, yet regional productivity and household income often improve in their wake. Why? Using administrative plant-level microdata from the US Census Bureau and an event study design, I trace the creative destruction process that follows large, federally declared floods. Exits rise after flooding, primarily among the least productive plants. Their second-hand machines are then reallocated toward more productive survivors and, notably, toward high-productivity entrants. Survivors also upgrade their machinery as they rebuild and see productivity gains. A key mechanism is that federal disaster spending expands access to financing, particularly for nimble, well-managed new and young firms that disproportionately drive job creation and productive churn. In the absence of federal aid, however, financing constraints dampen this creative destruction, misallocating resources and lowering residents' income. My findings reveal a novel, underappreciated channel through which government spending supports disaster-hit economies and underscore its critical role in a warming world.Economic Resilience in the Storm’s Wake: Hurricane Impact on Business Dynamics and Local Market Structure
Abstract
Hurricanes cause significant economic disruption—damaging infrastructure, interrupting supply chains, and undermining business continuity. This paper estimates the short- and long-term effects of hurricanes on business dynamics and local market structure, focusing on Louisiana from 2000 to 2022. We merge high-resolution establishment-level data from the National Establishment Time-Series (NETS) Database with detailed hurricane track and forecast data from NOAA’s National Hurricane Center. Our empirical strategy compares businesses directly affected by hurricanes to those located along forecasted paths that ultimately experienced no impact, enabling the construction of credible counterfactuals and addressing key concerns around selection and confounding. Implementing a staggered difference-in-differences framework, we find that hurricanes significantly reduce business survival in the year following landfall, with the largest effects concentrated among small and locally owned firms. In the longer run, hurricanes alter local market structure by increasing business turnover and encouraging new firm entry, leading to greater establishment density and competitive intensity. We also document demographic shifts post-disaster, including rising concentrations of low-income populations in heavily impacted areas. These results show that hurricanes have enduring effects on the composition of firms, markets, and communities, extending well beyond physical destruction. By integrating forecast data into the identification strategy, the analysis sharpens causal inference and advances understanding of how localized shocks shape economic geography. This study contributes to the literature on natural disasters, firm behavior, and local resilience by offering a granular view of post-disaster dynamics across a large sample of events and establishments. The findings carry important implications for disaster preparedness and recovery policies, particularly in supporting vulnerable business sectors and promoting long-term resilience in regions exposed to increasing climate-related risks.Understanding the Disclosure Practices of Firms Affected by a Natural Disaster: The Case of Hurricanes
Abstract
This paper investigates the disclosure practices of firms affected by hurricanes. I document that when a hurricane hits, there is an increase in investor uncertainty. During the hurricane period (approximately ten days), there is an increase in abnormal volume, stock volatility, spread, and illiquidity for firms that later report that they experienced hurricane damage. I find that firms with little to no impact from the hurricane disclose this information immediately after the hurricane. In contrast, firms impacted by the hurricane delay reporting the damage until the next earnings announcement. Furthermore, firms with “good news” that the hurricane had little damage to operations disclose this news in the headlines of the earnings release (high salience) while firms that disclose a negative impact are more likely to bury the news in the body of the earnings press release (low salience). I also find that hiding the news in the body of the text has attenuating effect (weaker stock market reaction) on those firms that disclose qualitative and not quantitative hurricane damage. These results are interesting for both US and international audiences because managers in all countries that experience natural disasters have to decide how to make disclosures about these news. The results also suggest that management’s strategic disclosure practices can be successful in reducing stock price volatility.Hot Weather, Hot Tempers: the Impact of Heat Waves on Intimate Partner Violence in Peru
Abstract
This paper investigates the causal relationship between acute extreme temperature shocks—heat waves—and intimate partner violence (IPV) in Peru, highlighting the intersection between environmental stressors and gender-based violence. Using high-frequency weather data linked to nationally representative survey data, I find that heat waves significantly increase IPV, with more pronounced effects in urban areas. I rule out income effects and changes in time use as key mechanisms. Instead, two channels emerge: First, heat waves exacerbate psychological distress and mental health issues among male partners in urban settings, increasing the likelihood of violent behavior. Second, heat waves contribute to heightened levels of community violence, which may reinforce social norms that can normalize aggression within households. These findings emphasize the broader economic and social costs of climate shocks and underscore the importance of incorporating gender-sensitive protections into climate adaptation and public health strategies, particularly for urban populations vulnerable to extreme heat.Can Disaster Relief Reduce Conflicts? Evidence from Imperial China (1644–1911)
Abstract
This study investigates whether government disaster relief measures, such as tax reductions and food aid, effectively mitigate social conflicts. To address this question, We are compiling a unique prefecture-level dataset on disasters, government relief responses, and social unrest in the Chinese Empire from 1644 to 1911. The data was extracted from the imperial government records which contain 50 million words using artificial intelligence (LLMs). Based on these data, we found that the state capacity of the Chinese Empire began to decline sharply in the early 19th century. The government reduced the frequency of disaster relief and provided little to no food aid. Using prefecture-level data, We examine the mitigating effects of disaster relief on conflicts such as peasant rebellions triggered by climate shocks or earthquakes. We found that peasant uprisings occurred less frequently in regions that received more disaster relief.JEL Classifications
- Q5 - Environmental Economics