Direct and Indirect Effects of Extreme Weather Events and Potential Estimation Biases
EfD Authors:
The literature analyzing the effects of extreme weather events on social and economic outcomes has increased significantly in the last few years. Most of these analyses use either self-reported data about whether the storm affected the respondent or aggregated data such as precipitation at municipality level. We argue that these estimates might be biased due to the inclusion of households that are not directly affected but live close enough to be indirectly affected through economic or government assistance spillovers.