Epistemology

Natural disaster

Microeconomics

Economic impact analysis

Ecology

Philosophy

Economics

Population

Economic growth

Climate change

Meteorology

Biology

Geography

Demography

Gross domestic product

Empirical evidence

Neoclassical economics

Sociology

Economic cost

Empirical research

Natural resource economics

Review of Environmental Economics and Policy

Economic losses from natural disasters have been increasing in recent decades. This has been attributed mainly to population and economic growth in disaster-prone areas. Future natural disaster losses are expected to increase due to a continued increase in economic exposure and climate change. This highlights the importance of designing policies that can mitigate the impacts of these disasters on the economy and society. A rapidly expanding literature has estimated the direct (e.g., property damage) and indirect (e.g., gross domestic product growth, trade) economic impacts of natural disasters. This article reviews this emerging literature. We synthesize the main theoretical, computational, and empirical methods used, summarize key findings on the economic impacts of natural disasters, and discuss factors that have been found to mitigate disaster impacts. We conclude by identifying lessons for policymakers and outlining an agenda for future research in this field.

The Economic Impacts of Natural Disasters: A Review of Models and Empirical Studies