Gone With the Wind: Tornadoes and Local Wealth in the United States

Abstract

This paper estimates the effect of tornadoes on local wealth in the United States. Combining the GEOWEALTH-US database (1960–2020) with geocoded tornado paths, and employing the de Chaisemartin and D’Haultfœuille (2026. “Difference-In-Differences Estimators of Intertemporal Treatment Effects.” The Review of Economics and Statistics 108 (4): 863–80) estimator for non-absorbing treatments, I find that exposure to F2+ tornadoes reduces mean household wealth by 3.3 % and median wealth by 5.3 %, with parallel declines in house values and no evidence of attenuation over longer horizons. Losses are concentrated in commuting zones with lower baseline homeownership, income, and house values. These findings indicate that tornadoes generate persistent, spatially concentrated wealth losses.