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Forest Policy and Economics

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Environmental impact analysis, Economic development, Environmental economics


The link between economic growth and natural hazards has long been studied to better understand the effects of natural hazards on local, regional, and country level growth patterns. However, relatively little generalizable research has focused on wildfires, one of the most common forest disturbances in the western United States (US). We examined the effect of large wildfires on employment growth across sectors and time in the western US.We matched wildfire occurrences from 2004 to 2008 and their duration with monthly employment data to identify the effect of wildfire on employment growth. Wildfires generally tended to exhibit positive effects on employment during the periods that suppression efforts were active. However, the overall positive effect maskswinners and losers across sectors — such as natural resources and mining and leisure and hospitality, respectively. The overall positive effect then transitioned to a negative drag on local employment growth for a period of up to two years following the wildfire. We explore reasons why some sectors win while others lose and explanations for the lingering effects of a large wildfire on the economy as a whole.


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