Conference Agenda

This study investigates how public investment in a storm surge barrier shapes risks under evolving flooding conditions and influences private residential location decisions and welfare. Integrating an econometric sorting model with a hydrodynamic flood model and applying the framework to one of the most populated and flood-prone regions in the United States—the Houston–Galveston area of Texas-our estimates suggests that while all racial groups avoid floodplains, white and Asian households show higher willingness to pay for flood risk avoidance. Without the Texas Coastal Spine storm surge barrier system, sea level rise could cause a $6.6B welfare loss for coastal homeowners. The barrier reduces the aggregate losses by half, but benefits are unequally distributed—disproportionately favoring white homeowners—highlighting the need for equitable protection strategies.

Climate change is intensifying weather extremes worldwide, yet our understanding of how these shocks affect firm-level productivity remains limited. This paper provides the first comprehensive assessment of how diverse weather dimensions impact economic productivity using granular firm data across 38 countries. We match over 12 million firm-year observations with high-resolution weather data, examining the economic implications of a broad range of weather statistics, including temperature variability, precipitation patterns, heatwaves and cold spells. We find that, beyond the well-studied effects of mean temperatures, day-to-day temperature variability emerge as the most economically significant weather determinant: a one-standard-deviation increase reduces firm productivity by approximately 1%, consistent with macro-level evidence. Heatwave severity reduces productivity by 0.24% for a one-standard-deviation increase, confirming previous findings with expanded geographic scope. Decomposing weather into transitory shocks and long-run climate, we find evidence of partial adaptation to temperature variability and precipitation, that is, firms in regions with historically high exposure experience attenuated losses, but no adaptation to extreme heat: even firms in historically hot locations remain equally vulnerable to heatwave shocks. These results provide crucial microeconomic foundations for climate damage functions and suggest that focusing exclusively on mean temperature changes underestimates the economic costs of climate change, particularly as autonomous adaptation appears unable to offset damages from increasingly frequent heat extremes.

Leisure and recreation are an important and temperature-sensitive source of welfare, yet the welfare consequences of extreme temperatures across diverse recreational activities have rarely been quantified in a unified and comparable empirical framework. Using tens of millions of Weibo check-ins matched with Dianping point-of-interest (POI) information over 400 days in China during 2023–2024, we estimate the temperature response of visits and expressed sentiment across 21 leisure and recreation categories. We find that visits–temperature relationships fall into three dominant shapes: inverted-U, monotonic increasing, and flat. Patterns of offsetting changes in visits across categories, together with opposite-signed responses of sentiment and visits in some indoor activities, are consistent with cross-category substitution under extreme heat. We further identify two channels of adaptation: acclimatization, meaning reduced sensitivity to locally common extremes, and substitution across activity categories. To obtain a welfare measure, we combine category-specific average spending and demand elasticities to translate temperature-induced changes in visits into the price compensation required to maintain baseline visitation. Aggregating across activities, we estimate that if each city experiences one additional hour of extreme heat/cold on a given day, nationwide recreational welfare losses amount to approximately 182/714 million RMB. Under SSP5-8.5 projections, net effects become positive by the end of the century (about +58 RMB per person per year), primarily because the aggregated gains from fewer extreme-cold exposures outweigh added losses from increased extreme heat. Our study provides a scalable welfare accounting framework for the leisure and recreation domain that incorporates substitution and offers quantitative evidence to inform urban heat and cold adaptation planning.

As climate change intensifies, extreme weather events increasingly threaten communities and infrastructure. These shocks can act as a form of creative destruction, generating opportunities for sustainable reconstruction, while also reshaping risk perceptions and influencing investment in green technologies. This paper empirically examines how natural disasters and weather extremes affect the diffusion of green buildings across the United States. Using a panel dataset of buildings certified under the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) program at the city level from 2000 to 2020, we find that major flooding events increase the number of LEED-certified buildings within three to five years, supporting the “rebuilding greener” hypothesis. This increase is driven primarily by private buildings rather than public properties. Hurricanes initially reduce green building development, while growth is observed six to eight years post-event. We also find that extreme hot days are associated with increased adoption of green buildings, while effects of extreme and moderately cold days are less consistent. Overall, our findings highlight the heterogeneous and dynamic ways in which climate shocks shape green building adoption and provide insights for policymakers and planners seeking to encourage sustainable urban development in a changing climate.