How tropical storms destroy, rebuild firms1 min read . Updated: 20 Feb 2020, 10:05 PM IST
To measure firms’ exposure to storms, the study creates a storm index based on wind speeds and pincodes
Cyclone Fani hit the coast of Odisha in 2019, destroying lives and businesses. According to new research, many of these companies will struggle to recover. In the study, researchers Martino Pelli and others examine how companies respond to the capital destruction caused by external shocks such as hurricanes, cyclones and other tropical storms. The study analyses the sales and productivity of firms after a storm destroys capital. Specifically, the authors test whether unproductive companies exit the market after a storm and if those that survive adapt by investing more.
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