Publication Type

Journal Article

Version

publishedVersion

Publication Date

12-2025

Abstract

This paper compiles high-resolution geospatial inundation areas of China for the period 2000–2009 based on satellite imagery repositories filtered by the Global Flood Database (GFD). In parallel, we geocode a comprehensive firm-level dataset of China and combine these two sets of geospatial data to identify the set of inundated firms in each year of flood events, as well as the distances of all non-inundated firms from the inundated areas. Given the high-resolution inundation data, we adopt a generalized dynamic-panel specification to estimate dynamic and spatial spillover effects of floods on firm-level production activities (including outputs, capital and labor inputs, and productivities). We find negative and persistent effects of floods on firm-level performance measures, and negative but short-run spillover effects on non-inundated firms in nearby neighborhoods. In contrast, non-inundated firms located 6–12 km away from the inundated area expanded their production in the long run, suggesting reallocation of production activities/facilities away from the inundation area toward the outer rings of the neighborhood. We conduct various robustness checks and extended analyses, identify moderating/aggravating factors of inundation impacts, assess the aggregate effects at the economy-wide, province, and sector levels, and quantify the propagation of flood exposures via the input–output linkages.

Keywords

floods, satellite imagery, firm performance, dynamic effects, spatial spillovers

Discipline

Economics | Economic Theory

Research Areas

Marketing; International Economics

Publication

Journal of Environmental Economics and Management

Volume

137

Issue

1

First Page

875

Last Page

903

ISSN

0095-0696

Identifier

10.1016/j.jeem.2025.103276

Publisher

Elsevier

Additional URL

https://doi.org/10.1016/j.jeem.2025.103276

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