Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/325291 
Year of Publication: 
2025
Series/Report no.: 
ifo Working Paper No. 416
Publisher: 
ifo Institute - Leibniz Institute for Economic Research at the University of Munich, Munich
Abstract: 
Extreme weather events are becoming more frequent with climate change, yet cold stress events remain understudied. I use the 2021 Texas freeze to examine household adaptation to extreme weather-induced blackouts, focusing on (1) adaptation uptake, (2) socio-economic disparities in adaptive capacity, and (3) salience spillovers. Using an event study design, I analyze the time- varying effects of a one-off dosage treatment, defined as blackout exposure. I leverage novel data on installation permits for home generators and rooftop-solar-battery systems as adaptation measures. Results show a significant, robust response peaking in the second calendar quarter post-treatment, where a 10 percentage point increase in outages leads to 16.4 (8) additional quarterly permits per 10,000 households for generators (solar-battery systems). Google search data suggests the 2021 freeze was widely associated with climate change for the first time, possibly explaining the adaptation response absent in earlier events. Notably, in addition to finding weaker responses for lower-income, less-educated, and high-minority neighborhoods, I also identify a one-quarter delay in their response, highlighting disparities in both adaptive capacity and promptness. Salience spillovers further reinforce adaptation, which can be explained both by social connectedness and geographic proximity. My findings underscore the need for public outage resiliency investments and regulation to decrease unequal future exposure and policies that address inequities in climate resilience.
Subjects: 
Extreme weather
Adaptation
Outage
Climate change
Event study
Dosage treatment
JEL: 
D12
Q54
L94
Document Type: 
Working Paper

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