Necessity as the mother of invention: Innovative responses to natural disasters

Qing Miao and David Popp

Journal of Environmental Economics and Management, 2014, vol. 68, issue 2, 280-295

Abstract: How do innovators respond to the shock of a natural disaster? Do natural disasters spur technical innovations that can reduce the risk of future hazards? This paper examines the impact of three types of natural disasters—floods, droughts and earthquakes—on the innovation of their respective mitigation technologies. Using patent and disaster data, our study is the first to empirically examine adaptation responses across multiple sectors at the country level. Considering the potential endogeneity of disaster damages, we use meteorological and geophysical data to create hazard intensity measures as instrumental variables. Overall, we show that natural disasters lead to more risk-mitigating innovations, while the degree of influence varies across different types of disasters and technologies.

Keywords: Natural disasters; Climate change adaptation; Induced innovation; Risk perception; Knowledge stocks; Earthquakes; Droughts; Floods (search for similar items in EconPapers)
JEL-codes: O3 Q54 Q55 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (43)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:68:y:2014:i:2:p:280-295

DOI: 10.1016/j.jeem.2014.06.003

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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

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