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Adapting to Flood Risk: Evidence from a Panel of Global Cities

Author

Listed:
  • Sahil Gandhi
  • Matthew E. Kahn
  • Rajat Kochhar
  • Somik Lall
  • Vaidehi Tandel

Abstract

We assemble a global dataset capturing the universe of major floods in 9,468 cities across 175 countries to estimate flood damage and test adaptation hypotheses. Analyzing 3,931 major floods (2000–2023) and monthly night lights data (2012–2023) as a proxy for urban economic activity, we present three key findings. First, floods lead to a 3.5-times larger decline in night lights in cities in low-income countries compared to cities in high-income countries. Second, the impact of floods on economic activity and mortality has decreased over time. Third, we explore the mechanisms driving this adaptation. Cities with greater prior flood exposure experience smaller impacts, supporting experience-driven adaptation. In high-income countries, migration, critical infrastructure intensity, and dam protection enhance flood resilience, but these factors are less effective in low-income countries. The disproportionate impacts and slower flood adaptation in cities in low-income countries highlight a significant protection gap.

Suggested Citation

  • Sahil Gandhi & Matthew E. Kahn & Rajat Kochhar & Somik Lall & Vaidehi Tandel, 2022. "Adapting to Flood Risk: Evidence from a Panel of Global Cities," NBER Working Papers 30137, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:30137
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    Cited by:

    1. Tol, Richard S.J., 2024. "A meta-analysis of the total economic impact of climate change," Energy Policy, Elsevier, vol. 185(C).
    2. A. Patrick Behrer & Jonah Matthew Rexer & Siddharth Sharma & Margaret Triyana, 2024. "Household and Firm Exposure to Heat and Floods in South Asia," Policy Research Working Paper Series 10947, The World Bank.
    3. Matteo Benetton & Simone Emiliozzi & Elisa Guglielminetti & Michele Loberto & Alessandro Mistretta, 2022. "Do house prices reflect climate change adaptation? Evidence from the city on the water," Questioni di Economia e Finanza (Occasional Papers) 735, Bank of Italy, Economic Research and International Relations Area.
    4. Anish Sugathan & Arpit Shah & Deepak Malghan, 2024. "Washed Away: Industrial Capital, Labor, and Floods," IIMA Working Papers WP 2024-12-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    5. Berg, Kimberly A. & Curtis, Chadwick C. & Mark, Nelson C., 2024. "GDP and temperature: Evidence on cross-country response heterogeneity," European Economic Review, Elsevier, vol. 169(C).
    6. Marcos Sanso-Navarro & Guillermo Peña, 2023. "Long-run effects of floods at municipality level in Spain," French Stata Users' Group Meetings 2023 29, Stata Users Group.

    More about this item

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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