Extremes in economic damage from U.S.-landfalling hurricanes: considering hurricane climatology, exposure, and vulnerability effects

Abstract:

The growing economic damage incurred by U.S.-landfalling hurricanes is arguably due to a mixture of changing hurricane activity with climate change, increased wealth and population exposure along the coast, and changes in vulnerability to landfalls. Considering the multiple contributing factors, we aim to connect the climate effects on hurricanes to the resulting expected economic damage.

First, we separate out the effects of exposure and focus on the relationship between the physical storm landfall attributes and damage. This is accomplished by calculating a Damage Fraction, the ratio of economic damages to the total economic value in the affected region. The record of U.S. hurricane economic damage from 1900-2004 is analyzed using a peaks-over-threshold approach in which the generalized Pareto distribution (GPD) is applied to model the probability distribution of Damage Fraction extremes. Direct hurricane hazards (maximum sustained wind, maximum surge height) as well as hazard-related variables (bathymetric slope, storm size) are incorporated into the GPD model as covariates. It has been shown that this type of GPD model can be applied to data sets of simulated hurricane tracks downscaled from current and future climate model climates to make climate change risk assessments for the U.S.

Second, the Damage Fraction will be modeled as a function of not only hazard parameters but also vulnerability parameters, such as different levels of building codes and standards. Before Hurricane Irene and Superstorm Sandy, policy-makers and engineers were more likely to prepare for hurricane hazards in Florida than in New York and New Jersey. Events such as Hurricane Andrew in 1992 also created greater awareness and effected change in building codes and hazard mitigation strategies. Incorporating vulnerability parameters is intended to account for expected regional and temporal variations in hurricane economic vulnerability.