The economic impact of floods

Guzman Gonzalez-Torres Fernandez and Miles Parker

Economic Bulletin Boxes, 2025, vol. 1

Abstract: Major floods have become recurrent events in Europe and their frequency is set to increase with climate change. Drawing on several pieces of ECB analysis, we show that the economic effects depend largely on economic and institutional factors at the regional level. There is evidence of high-income regions “building back better”, whereas lower-income regions can suffer prolonged periods of lower activity. Insurance and spending on adaptation measures like flood defences can already contain the potential damages from further extreme weather events in the near future. JEL Classification: D24, E24, J22, R11, Q54

Keywords: climate change; floods (search for similar items in EconPapers)
Date: 2025-02
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