Economic footprint of California wildfires in 2018

Daoping Wang, Dabo Guan (), Shupeng Zhu, Michael Mac Kinnon, Guannan Geng, Qiang Zhang, Heran Zheng, Tianyang Lei, Shuai Shao, Peng Gong and Steven J. Davis
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Daoping Wang: Shanghai University of Finance and Economics
Dabo Guan: Tsinghua University
Shupeng Zhu: University of California, Irvine
Michael Mac Kinnon: University of California, Irvine
Guannan Geng: Tsinghua University
Qiang Zhang: Tsinghua University
Heran Zheng: Norwegian University of Science and Technology
Tianyang Lei: Tsinghua University
Peng Gong: Tsinghua University
Steven J. Davis: University of California, Irvine

Nature Sustainability, 2021, vol. 4, issue 3, 252-260

Abstract: Abstract Recent increases in the frequency and scale of wildfires worldwide have raised concerns about the influence of climate change and associated socioeconomic costs. In the western United States, the hazard of wildfire has been increasing for decades. Here, we use a combination of physical, epidemiological and economic models to estimate the economic impacts of California wildfires in 2018, including the value of destroyed and damaged capital, the health costs related to air pollution exposure and indirect losses due to broader economic disruption cascading along with regional and national supply chains. Our estimation shows that wildfire damages in 2018 totalled $148.5 (126.1–192.9) billion (roughly 1.5% of California’s annual gross domestic product), with $27.7 billion (19%) in capital losses, $32.2 billion (22%) in health costs and $88.6 billion (59%) in indirect losses (all values in US$). Our results reveal that the majority of economic impacts related to California wildfires may be indirect and often affect industry sectors and locations distant from the fires (for example, 52% of the indirect losses—31% of total losses—in 2018 were outside of California). Our findings and methods provide new information for decision makers tasked with protecting lives and key production sectors and reducing the economic damages of future wildfires.

Date: 2021
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DOI: 10.1038/s41893-020-00646-7

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