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From Extreme Events to Extreme Seasons: Financial Stability Risks of Climate Change in Mexico

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dc.contributor.authorDolk, Michaela
dc.contributor.authorLaliotis, Dimitrios
dc.contributor.authorLamichhane, Sujan
dc.date.accessioned2024-02-12T13:48:15Z
dc.date.available2024-02-12T13:48:15Z
dc.date.issued2024-02-12
dc.description.abstractThis paper explores the financial stability implications of acute physical climate change risks using a novel approach focusing on a severe season associated with a series of tropical cyclone and flood events. Our approach was recently applied to study physical risks in the Mexican financial sector, but the framework also pertains to other countries. We show that even if the scale of individual climate events may not be material at an aggregate national scale, considering a sequence of events could lead to potentially significant macro-financial impacts in the short term. This could occur even if none of the individual events affect the particular region(s) with the highest concentrations of banking sector exposures. Our results indicate the potential for even greater effects in the future, given the increasing severity and frequency of extreme events from climate change. Thus, this paper highlights the importance of consideringseries of extreme physical risk events driven by climate change, rather than just individual extreme events, to better understand financial stability implications and design effective policies.en
dc.identifierhttp://documents.worldbank.org/curated/en/099140001292433743/IDU107653ca919d7014a041b1e41af77f66c05f5
dc.identifier.doi10.1596/41037
dc.identifier.urihttps://openknowledge.worldbank.org/handle/10986/41037
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.relation.ispartofseriesEquitable Growth, Finance and Institutions Insight - Finance
dc.rightsCC BY-NC 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by-nc/3.0/igo
dc.subjectCLIMATE-RELATED DISASTERS
dc.subjectDIRECT DAMAGE MODELS
dc.subjectMACROECONOMIC IMPACT
dc.subjectINDIVIDUAL EVENTS
dc.subjectEVENT SEQUENCES
dc.titleFrom Extreme Events to Extreme Seasonsen
dc.title.subtitleFinancial Stability Risks of Climate Change in Mexicoen
dc.typeReport
dspace.entity.typePublication
okr.crossref.titleFrom Extreme Events to Extreme Seasons: Financial Stability Risks of Climate Change in Mexico
okr.date.disclosure2024-02-12
okr.date.lastmodified2024-01-29T00:00:00Zen
okr.doctypeEconomic & Sector Work
okr.docurlhttp://documents.worldbank.org/curated/en/099140001292433743/IDU107653ca919d7014a041b1e41af77f66c05f5
okr.guid099140001292433743
okr.identifier.docmidIDU-07653ca9-9d70-4a04-b1e4-af77f66c05f5
okr.identifier.doihttp://dx.doi.org/10.1596/41037
okr.identifier.externaldocumentum34247860
okr.identifier.internaldocumentum34247860
okr.identifier.report187424
okr.import.id3126
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099140001292433743/pdf/IDU107653ca919d7014a041b1e41af77f66c05f5.pdfen
okr.region.administrativeLatin America and Caribbean
okr.region.countryMexico
okr.topicFinance and Financial Sector Development::Finance and Development
okr.topicEnvironment::Adaptation to Climate Change
okr.topicEnvironment::Natural Disasters
okr.unitEFI-FCI-Risk Finance (EFNRF)
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