Reopening businesses after Hurricane Harvey: evidence from a duration model with spatial effects.

Abstract

Post-disaster business return is key to restoring the local economy. This paper applies a duration model to analyse factors that explain the delay in reopening a business in south Texas, United States, after Hurricane Harvey struck the region in August 2017. Other than property damage, the duration of business closure depended on the type of business and the various characteristics of its owner. Reflecting the vital role that social capital plays in disaster resilience, local chamber of commerce members tended to reopen their businesses sooner than their non-member counterparts. Yet, there is evidence in support of the vulnerability of female chamber members. In addition to social networks, the finding of spatial interdependence implies that the decision of business owners to resume operations in the wake of a disaster is influenced by the decisions of their neighbours. Spatial interdependence also highlights the importance of providing disaster relief to businesses in a timely manner.