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Lucas Husted
We show that natural disasters affect a region’s aggregate human capital through at least four channels. In addition to causing out-migration, natural disasters reduce student achievement, lower high school graduation rates, and decrease post-secondary attendance. We estimate that disasters that cause at least $500 in per capita property damage reduce the net present value (NPV) of an affected county’s human capital by an average of $505 per person. These negative effects on human capital are not restricted to large disasters: less severe events – disasters with property damages of $100-$500 per capita – also cause significant and persistent reductions in student achievement and post-secondary attendance.