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The Impact of Storms on Firm Survival: A Bayesian Spatial Econometric Model for Firm Survival

Mihaela Craioveanu ^a

Dek Terrell ^b

^aDepartment of Economics and Finance, University of Central Missouri, Warrensburg, MO, USA

^bDepartment of Economics, Louisiana State University, Baton Rouge, LA, USA

Spatial Econometrics: Qualitative and Limited Dependent Variables

ISBN: 978-1-78560-986-2, eISBN: 978-1-78560-985-5

Publication date: 1 December 2016

Abstract

This paper investigates the impact of the storms Katrina and Rita on firm survival in the Orleans Parish. In particular, a Bayesian spatial probit model is used to assess the impact of a number of firm characteristics on firm survival. The results reveal that larger firms and those with less flooding are more likely to survive. Larger chain stores were less likely to return to the city than sole proprietorships. Spatial results also reveal a very strong spatial component to firm survival just after the storm which diminishes as time passed.

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Acknowledgements

Acknowledgments

The authors are thankful to the Louisiana Recovery Authority, Louisiana Workforce Commission, and Louisiana Department of Economic Development for supporting this research. The views expressed are those of the authors and do not necessarily reflect the positions of these state agencies.

Citation

Craioveanu, M. and Terrell, D. (2016), "The Impact of Storms on Firm Survival: A Bayesian Spatial Econometric Model for Firm Survival", Spatial Econometrics: Qualitative and Limited Dependent Variables (Advances in Econometrics, Vol. 37), Emerald Group Publishing Limited, Leeds, pp. 81-118. https://doi.org/10.1108/S0731-905320160000037010

Publisher

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Emerald Group Publishing Limited