Scholarlink

<p>We examine the heterogeneous causal effects of natural disasters on housing price appreciation across 3,072 U.S. counties in all 50 states that vary in their levels of economic freedom. Using a difference-in-differences (DiD) framework and two decades of data, we find that although natural disasters generally dampen housing price appreciation, the decline is significantly smaller and more short-lived in counties with greater economic freedom. These results remain robust to the inclusion of comprehensive county and time fixed effects, alternative model specifications, and multiple robustness checks. Our findings suggest that economic freedom serves as an effective hedge against adverse shocks, such as natural disasters, particularly in the aftermath of severe events and for homes in the lower price range. Further analysis of the subcomponents of economic freedom reveals that government consumption expenditures, insurance and retirement payments, property and other taxes, and union density are the primary drivers of economic freedom’s mitigating effect.</p>

错误：搜索内容不能为空，请输入英文关键词
错误：关键词超出字数限制，请精简
高级检索

Does Economic Freedom Hedge Against Bad Luck? Evidence from Natural Disasters and Local Housing Price Appreciation

  • 期刊论文

  • 出版模式：

    开放获取

  • 发表日期：

    2026年3月17日

查看全文
  • Michael Abrokwah,
  • Xun Bian,
  • Erik Devos,
  • Xiaojin Sun

摘要

We examine the heterogeneous causal effects of natural disasters on housing price appreciation across 3,072 U.S. counties in all 50 states that vary in their levels of economic freedom. Using a difference-in-differences (DiD) framework and two decades of data, we find that although natural disasters generally dampen housing price appreciation, the decline is significantly smaller and more short-lived in counties with greater economic freedom. These results remain robust to the inclusion of comprehensive county and time fixed effects, alternative model specifications, and multiple robustness checks. Our findings suggest that economic freedom serves as an effective hedge against adverse shocks, such as natural disasters, particularly in the aftermath of severe events and for homes in the lower price range. Further analysis of the subcomponents of economic freedom reveals that government consumption expenditures, insurance and retirement payments, property and other taxes, and union density are the primary drivers of economic freedom’s mitigating effect.