团队

Are landlocked countries at risk from sea-level rise? We identify a new mechanism where natural disaster shocks influence countries’ macroeconomic performance through cross-border trade spillovers. Analyzing global data on climate disasters, infrastructure, trade, and the macroeconomy from 1970 to 2019, we find that climate disasters impacting ports, critical infrastructure for international trade, reduce imports, exports, and economic output in both the affected country and its major trade partner (both upstream and downstream) countries. The GDP effects on main upstream and downstream countries are as large as those in directly impacted countries: While directly affected countries offset climate disaster damages with increased government spending and investment, trade partners do not. Effective adaptation efforts, including building climate-resilient infrastructure and implementing disaster relief measures, must account for the cross-border spillover effects of climate disasters.