Storm clouds over innovation: Typhoon shocks and corporate R&D activities

Xue Lei and Xueguo Xu

Economics Letters, 2024, vol. 244, issue C

Abstract: This study investigates the economic impact of typhoon disasters on corporate innovation activities, a critical driver of economic growth and resilience. Utilizing a comprehensive dataset of Chinese public companies from 2010 to 2022 and employing a wind field model to construct a city-level typhoon destruction index, we apply difference-in-differences and instrumental variable methods to analyze the effects on corporate innovation. Our findings reveal that typhoon disasters significantly reduce both patent filings and R&D investment intensity, particularly in coastal areas and technology-intensive industries. The adverse effects are transmitted through financial constraints, human capital loss, and infrastructure damage. This research contributes to understanding the microeconomic implications of extreme weather events on innovation-driven economic growth, offering insights for disaster resilience policies in vulnerable regions.

Keywords: Typhoon disasters; Corporate innovation; Natural Disaster Economics (search for similar items in EconPapers)
JEL-codes: L25 O32 Q54 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:244:y:2024:i:c:s0165176524004981

DOI: 10.1016/j.econlet.2024.112014

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