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Journal Article

Economic losses from hurricanes cannot be nationally offset under unabated warming


Middelanis,  Robin
Potsdam Institute for Climate Impact Research;


Willner,  Sven
Potsdam Institute for Climate Impact Research;


Otto,  Christian
Potsdam Institute for Climate Impact Research;


Levermann,  Anders
Potsdam Institute for Climate Impact Research;

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Middelanis, R., Willner, S., Otto, C., Levermann, A. (2022): Economic losses from hurricanes cannot be nationally offset under unabated warming. - Environmental Research Letters, 17, 104013.

Cite as: https://publications.pik-potsdam.de/pubman/item/item_27439
Tropical cyclones range among the costliest of all meteorological events worldwide and planetary scale warming provides more energy and moisture to these storms. Modelling the national and global economic repercussions of 2017’s Hurricane Harvey, we find a qualitative change in the global economic response in an increasingly warmer world. While the United States were able to balance regional production failures by the original 2017 hurricane, this option becomes less viable under future warming. In our simulations of over 7000 regional economic sectors with more than 1.8 million supply chain connections, the US are not able to offset the losses by use of national efforts with intensifying hurricanes under unabated warming. At a certain warming level other countries have to step in to supply the necessary goods for production, which gives US economic sectors a competitive disadvantage. In the highly localized mining and quarrying sector—which here also comprises the oil and gas production industry—this disadvantage emerges already with the original Hurricane Harvey and intensifies under warming. Eventually, also other regions reach their limit of what they can offset. While we chose the example of a specific hurricane impacting a specific region, the mechanism is likely applicable to other climate-related events in other regions and other sectors. It is thus likely that the regional economic sectors that are best adapted to climate change gain significant advantage over their competitors under future warming.