Transcript Econ331presentation

Economics of Hurricanes and
Implications of Global Warming
Yuri Shadunsky
Estimating Vulnerability
Source: Nordhaus, 2009.
Economic Impacts
• Number of storms
• GDP
• Max wind speed at landfall
Damage-Intensity Function
Source: Nordhaus, 2009.
9?!?! That’s Crazy
• Statistical Bias
• Non-wind damages.
• Catastrophic failure
Hurricanes and Global Warming
• Project impact of doubling of carbon
dioxide concentrations on hurricane
damages.
Hurricanes and Global Warming
(cont.)
Source: Nordhaus, 2009.
Complications
• A rise in sea levels exposes more capital
to risks from hurricanes.
– Estimate: SLR will add .5% in damages per
year over the next century.
• Adaptation
– Envelope Theorem