NATURAL DISASTERS AND INDIVIDUAL ECONOMIC PERFORMANCE: A CASE STUDY FROM THE SLAVE LAKE WILDFIRE

Philippe Kabore, Nicholas Rivers () and Catherine Deri Armstrong ()
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Philippe Kabore: Unité départementale des sciences de la gestion, Université du Québec à Rimouski, Rimouski, QC, Canada
Nicholas Rivers: Graduate School of Public and International Affairs, University of Ottawa, Ottawa, ON, Canada
Catherine Deri Armstrong: Department of Economics, University of Ottawa, Ottawa, ON, Canada

Climate Change Economics (CCE), 2025, vol. 16, issue 03, 1-29

Abstract: In May 2011, the municipality of Slave Lake, Alberta, was hit by a devastating wildfire; the second costliest natural disaster in Canada at the time. Residents of Slave Lake were forced to evacuate for at least a month. This case study uses longitudinal income tax data from 2004 to 2018 to estimate the short, medium, and long-term individual economic effects of this wildfire. Estimates suggest an average drop in total income of 10.5% relative to a counter-factual scenario with no wildfire over the 7 years following the wildfire, mainly driven by a decrease in employment income. The percentage of total income lost is similar for males and females. The largest effects are found for workers in the agriculture and forestry sectors. Back-of-the- envelope calculations suggest an aggregate loss in employment income of $150 million in the 7 years following the disaster, equivalent to over 13% of direct economic losses due to property damage, firefighting, and contemporaneous business closure.

Keywords: Natural disasters; wildfires; income; Slave Lake (search for similar items in EconPapers)
JEL-codes: D14 H24 Q54 R23 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1142/S2010007825500125

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