Droughts, Floods and Financial Distress in the United States / John Landon-Lane, Hugh Rockoff, Richard H. Steckel.

Format:

Book

Author/Creator:

Landon-Lane, John.

Contributor:

National Bureau of Economic Research.

Rockoff, Hugh.

Steckel, Richard H.

Series:

Working Paper Series (National Bureau of Economic Research) no. w15596.

NBER working paper series no. w15596

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2009.

Summary:

The relationships among the weather, agricultural markets, and financial markets have long been of interest to economic historians, but relatively little empirical work has been done. We push this literature forward by using modern drought indexes, which are available in detail over a wide area and for long periods of time to perform a battery of tests on the relationship between these indexes and sensitive indicators of financial stress. The drought indexes were devised by climate historians from instrument records and tree rings, and because they are unfamiliar to most economic historians and economists, we briefly describe the methodology. The financial literature in the area can be traced to William Stanley Jevons, who connected his sun spot theory to rainfall patterns. The Dust bowl of the 1930s brought the climate-finance link to the attention of the general public. Here we assemble new evidence to test various hypotheses involving the impact of extreme swings in moisture on financial stress.

Notes:

Print version record

December 2009.