Wave-like global economic ripple response to Hurricane Sandy
- Tropical cyclones range among the costliest disasters on Earth. Their economic repercussions along the supply and trade network also affect remote economies that are not directly affected. We here simulate possible global repercussions on consumption for the example case of Hurricane Sandy in the US (2012) using the shock-propagation model Acclimate. The modeled shock yields a global three-phase ripple: an initial production demand reduction and associated consumption price decrease, followed by a supply shortage with increasing prices, and finally a recovery phase. Regions with strong trade relations to the US experience strong magnitudes of the ripple. A dominating demand reduction or supply shortage leads to overall consumption gains or losses of a region, respectively. While finding these repercussions in historic data is challenging due to strong volatility of economic interactions, numerical models like ours can help to identify them by approaching the problem from an exploratory angle, isolating the effect of interest. ForTropical cyclones range among the costliest disasters on Earth. Their economic repercussions along the supply and trade network also affect remote economies that are not directly affected. We here simulate possible global repercussions on consumption for the example case of Hurricane Sandy in the US (2012) using the shock-propagation model Acclimate. The modeled shock yields a global three-phase ripple: an initial production demand reduction and associated consumption price decrease, followed by a supply shortage with increasing prices, and finally a recovery phase. Regions with strong trade relations to the US experience strong magnitudes of the ripple. A dominating demand reduction or supply shortage leads to overall consumption gains or losses of a region, respectively. While finding these repercussions in historic data is challenging due to strong volatility of economic interactions, numerical models like ours can help to identify them by approaching the problem from an exploratory angle, isolating the effect of interest. For this, our model simulates the economic interactions of over 7000 regional economic sectors, interlinked through about 1.8 million trade relations. Under global warming, the wave-like structures of the economic response to major hurricanes like the one simulated here are likely to intensify and potentially overlap with other weather extremes.…
Author details: | Robin MiddelanisORCiDGND, Sven N. WillnerORCiDGND, Christian OttoORCiD, Kilian KuhlaORCiDGND, Lennart QuanteORCiDGND, Anders LevermannORCiDGND |
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DOI: | https://doi.org/10.1088/1748-9326/ac39c0 |
ISSN: | 1748-9326 |
Title of parent work (English): | Environmental research letters : ERL / Institute of Physics |
Publisher: | IOP Publ. Ltd. |
Place of publishing: | Bristol |
Publication type: | Article |
Language: | English |
Date of first publication: | 2021/12/18 |
Publication year: | 2021 |
Release date: | 2024/01/18 |
Tag: | Hurricane Sandy; economic ripples; extreme weather; impacts; loss propagation; natural disasters; supply chains |
Volume: | 16 |
Issue: | 12 |
Article number: | 124049 |
Number of pages: | 11 |
Funding institution: | Horizon 2020 Framework Programme of the European Union project RECEIPT [820712]; German Academic Scholarship Foundation; German Federal Ministry of Education and Research (BMBF)Federal Ministry of Education & Research (BMBF) [01LA1817C, 01LA1829A, 01LP1907A]; European Regional Development Fund (ERDF)European Commission; German Federal Ministry of Education and ResearchFederal Ministry of Education & Research (BMBF); Land Brandenburg |
Organizational units: | Mathematisch-Naturwissenschaftliche Fakultät / Institut für Informatik und Computational Science |
Mathematisch-Naturwissenschaftliche Fakultät / Institut für Physik und Astronomie | |
DDC classification: | 6 Technik, Medizin, angewandte Wissenschaften / 69 Hausbau, Bauhandwerk / 690 Hausbau, Bauhandwerk |
Peer review: | Referiert |
Publishing method: | Open Access / Gold Open-Access |
DOAJ gelistet | |
License (German): | CC-BY - Namensnennung 4.0 International |