DP13632 How the 1906 San Francisco Earthquake Shaped Economic Activity in the American West

Author(s): Philipp Ager, Katherine Eriksson, Casper Worm Hansen, Lars L√łnstrup
Publication Date: March 2019
Keyword(s): American West, Economic Geography, Location of Economic Activity, migration, Natural Disasters
JEL(s): N9, O15, O40, R11, R12
Programme Areas: Economic History
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=13632

This paper examines the long-run effects of the 1906 San Francisco Earthquake on the spatial distribution of economic activity in the American West. Using variation in the potential damage intensity of the earthquake, we show that more severely affected cities experienced lower population increases relative to less affected cities until the late 20th century. This long-lasting effect is largely a result of individuals' high geographical mobility at that time. Less affected areas became more attractive migration destinations in the immediate aftermath of the earthquake, which permanently changed the spatial distribution of economic activity in the American West.