Kara Riesing

Research

Effects of Tornadoes on Local Labor Markets (Job Market Paper)

In this paper, I examine the change in local labor markets caused by extreme tornadoes that occur in counties of the contiguous United States. I also investigate the effect these tornadoes have on neighboring counties and evaluate the labor market response in urban and rural counties separately as well. Using a generalized difference-in-difference approach on quarterly data spanning from 1975 to 2016, I find that violent tornadoes lead to persistently higher wages per worker two years following a tornado. Reviewing the data by urban and rural counties shows that a strong effect is observed in the employment levels of an urban county that is struck by a tornado, while the effect in the rural county is observed on wages per worker. Further, evaluating the response of labor markets by sectors reveals the industrial sectors that experience increased labor market activity. The response of the labor market varies based on the intensity of the tornado.

Here are links to the full paper and the appendix.

Man Vs. Nature: The Long Run

Reconstruction in the aftermath of large natural disasters and terrorist attacks plays a key role in the future trajectory of a country's economy. This paper focuses on the long run effects of natural disasters and trans-national terrorist attacks on growth and its components. I examine the differences and similarities in recovery in the aftermath of the two. Using a generalized difference in difference approach within the framework of a growth model on annual data of 87 countries spanning from 1969 to 2015, I find that they both have a similar negative impact on long run GDP growth despite their differences.

Man Vs. Nature: The Short Run

As a continuation to the previous research work on natural disaster and terrorist attacks, this paper examines the short run effects of these events on the economy. Furthermore, I distinguish between developed and developing countries to review the difference in their impacts and their responses in the immediate aftermath. I estimate a VAR-X model to examine the short run effects responses of the economy.

Future Research

Even though I am interested in continuing research on the effects of natural disasters as well as terrorist attacks, I am also interested in research related to economic growth and development. I am currently working on a research project that estimates the effect of women's participation and success at the Olympic games on economic growth and development. This is a co-authored paper with Andrew Jonelis and Jenny Minier titled, "Olympic Indicators and Female Economic Empowerment". This paper assumes that when a group of people are systematically denied opportunities in education and the labor market, and deprived of a voice in making decisions, allocations of labor and capital are likely to be sub-optimal and rates of technological progress are likely to be lower, reducing economic growth. Our results suggest that countries with a more balanced ratio of female to male Olympians, proxying female status across society, grow faster than their peers.

As a continuation to my job market paper, I plan on expanding my research focus to include the federal aid in the analysis to examine how much of the increase in wages per worker can be contributed to federal aid. I would also like to examine whether developing countries in the aftermath of disastrous events have easier access to capital than before. Another interesting aspect that I would like to explore is whether a billion dollar disaster leads to any redistribution in wealth.