The impacts of tropical storms on food prices: Evidence from China.

Climate change is a major source of external shocks to the economy. In this article, we estimate the short‐term impacts of tropical storms on food prices. After matching the track records of tropical storms with retail prices of food products during 1998 and 2012 in China, we find that tropical storms lead to food prices increasing by 2.3%, and the effect lasts more than one month. The positive impacts on prices mainly concentrate on fresh vegetable products. One main channel of price increases caused by tropical storms is the supply‐side shock to the transportation and distribution system. We find limited evidence of price increases driven by demand‐side shocks such as food displacement and food composition changes. The impacts of tropical storms on food price increases lead to a total loss amounting to $92 million each year on average. This study contributes to literature evaluating the price impacts caused by tropical storms and provides policy implications on enhancing food supply resilience. [ABSTRACT FROM AUTHOR]