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The Effect of Tropical Cyclones in Economic Activities: Micro Level Evidence from Mexico for Secondary and Tertiary Activities

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  • Juarez-Torres, Miriam
  • Puigvert, Jonathan E.

Abstract

This paper explores the effects of tropical cyclones on the economic activity of establishments in the manufacturing and service sectors in Mexico. The analysis relies on panel data that combines establishment-level economic activity with municipal-level exposure to tropical cyclones on a monthly basis to estimate an augmented distributed lag model. Results show that, after a tropical cyclone, the average manufacturing establishment experiences a short-term and small negative effect on production growth. For establishments in the service sector, the effect is small and negative on revenue growth, while positive, higher in magnitude, and more persistent on growth of operative expenditures. The disaggregated data allows for the analysis of the heterogeneity of the effects between manufacturing and services sectors.
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Suggested Citation

  • Juarez-Torres, Miriam & Puigvert, Jonathan E., 2019. "The Effect of Tropical Cyclones in Economic Activities: Micro Level Evidence from Mexico for Secondary and Tertiary Activities," 2019 Annual Meeting, July 21-23, Atlanta, Georgia 291044, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea19:291044
    DOI: 10.22004/ag.econ.291044
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    Cited by:

    1. Toan Phan & Felipe Schwartzman, 2023. "Climate Defaults and Financial Adaptation," Working Paper 23-06, Federal Reserve Bank of Richmond.

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    More about this item

    Keywords

    International Development;

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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