Do businesses “vote with their feet” Too? Examining firm mobility in response to hurricane risk

Rushaine Goulbourne, Amir Borges Ferreira Neto and Amanda Ross ()
Additional contact information
Rushaine Goulbourne: Freddie Mac
Amanda Ross: University of Alabama

The Annals of Regional Science, 2024, vol. 73, issue 3, No 5, 945-978

Abstract: Abstract Do firms sort in response to hurricane risk? We expand upon standard models of Tiebout sorting for households and explore the effect of hurricanes on firm mobility. Specifically, we examine if firms are more likely to move after experiencing category 3 or higher strength hurricane winds. Using the National Establishment Time-Series (NETS) data for Florida, we find that hurricanes are associated with an increase in the likelihood an establishment moves, especially within the state of Florida. Firms are less likely to move into Florida after a storm, suggesting that the costs of operating within the state change immediately after the storm. We explore various mechanisms that could be driving these results, finding specifically that FEMA assistance reduces mobility and that mobility is more likely due to the initial damage than a change in risk perceptions. Our findings are important for policy-makers as they show that hurricanes impact firm mobility and provide indicators of what is driving the movement after a storm.

JEL-codes: D7 R3 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s00168-024-01278-x Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:anresc:v:73:y:2024:i:3:d:10.1007_s00168-024-01278-x

Ordering information: This journal article can be ordered from
http://link.springer.com/journal/168

DOI: 10.1007/s00168-024-01278-x

Access Statistics for this article

The Annals of Regional Science is currently edited by Martin Andersson, E. Kim and Janet E. Kohlhase

More articles in The Annals of Regional Science from Springer, Western Regional Science Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().