Gone with the Wind: Estimating Hurricane and Climate Change Costs in the Caribbean

October 14, 2016

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Format: Chicago

Sebastian Acevedo Mejia. Gone with the Wind: Estimating Hurricane and Climate Change Costs in the Caribbean, (USA: International Monetary Fund, 2016) accessed October 6, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper studies the economic costs of hurricanes in the Caribbean by constructing a novel dataset that combines a detailed record of tropical cyclones’ characteristics with reported damages. I estimate the relation between hurricane wind speeds and damages in the Caribbean; finding that the elasticity of damages to GDP ratio with respect to maximum wind speeds is three in the case of landfalls. The data show that hurricane damages are considerably underreported, particularly in the 1950s and 1960s, with average damages potentially being three times as large as the reported average of 1.6 percent of GDP per year. I document and show that hurricanes that do not make landfall also have considerable negative impacts on the Caribbean economies. Finally, I estimate that the average annual hurricane damages in the Caribbean will increase between 22 and 77 percent by the year 2100, in a global warming scenario of high CO2 concentrations and high global temperatures.

Subject: Climate change, Environment, Greenhouse gas emissions, Natural disasters, Renewable energy

Keywords: Caribbean, Climate change, Climate impact, Damages in the Caribbean, Global, Greenhouse gas emissions, Hurricane, Natural disasters, Nominal GDP, Renewable energy, Storm damage, Terms tropical cyclone, Tropical cyclone, Tropical cyclone damage, Wind velocity, Wind-damage elasticity, Wind-damage function, Wind-damages relation, WP

Publication Details

Pages:

40
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2016/199
Stock No:

WPIEA2016199
ISBN:

9781475544763
ISSN:

1018-5941

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