The indirect economic costs of flooding: Evidence from transport disruptions during Storm Desmond

Flooding already imposes substantial costs to the economy – costs that are expected to rise in future, both as a result of changing weather patterns due to climate change, but also because of changes in exposure to flood... [ view full abstract ]

Flooding already imposes substantial costs to the economy – costs that are expected to rise in future, both as a result of changing weather patterns due to climate change, but also because of changes in exposure to flood risk resulting from socio-economic trends such as economic growth and urbanisation. However, our understanding of the total costs of extreme weather events on the economy remains incomplete – in particular, existing cost estimates tend to focus on direct damages, excluding potentially important indirect effects such as disruptions to tranpsort and other essential services. In this paper we estimate the costs to commuters of travel disruptions caused by flooding during the winter storms of 2015/16 in Ireland. We simulate, for every commuter in Co. Galway, their commuting travel times under the status quo and during the period of the floods and estimate the additional costs imposed on commuters. We estimate the total aggregate cost of extra time commuting due to flooding in Co. Galway during this period at €3.8 million. We also find that those already facing large commuting costs are burdened with extra costs by the floods. In areas particularly badly affected, extra costs amounts to 39% of earnings (during the period of disruption), while those on lower incomes suffer proportionately greater losses. While Storm Desmond was considered a 1-in-100 year event, under climate change we can expect events like this to occur with substantially greater frequency in future. Understanding the full economic costs of these extreme events is an important first step in preparing for a future with increased weather risk.