Analysis of Natural Disasters and COVID-19 Pandemic Complex Impacts on Distribution of PPP Loans

Published

December 15, 2024

Author(s)

Azin Al Kajbaf, Christina Gore, Jennifer Helgeson, Jarrod Loerzel

Abstract

Paycheck protection program (PPP) loans were established during the COVID-19 pandemic to help certain businesses continue paying their employees. Paycheck protection program loans were meant to help businesses recover from the disruptions caused by the COVID-19 pandemic; however, pre-existing socioeconomic stressors and the impacts of concurrent or previous natural disasters (e.g., hurricane events) could also amplify the impacts experienced by businesses. The concurrence of these interrupting acute shocks and chronic stressors creates a complex event that can result from combinations of natural, biological, and human-made causes. It is recognized that complex events tend to create an impact that is greater than the sum of their parts. The objective of this study is to evaluate whether the PPP loan allocations are correlated with prior natural hazard events. The heterogeneity in the correlations is investigated by examining natural hazard occurrence across time, severity of impacts, and county-level characteristics. Our analysis results show a strong association between counties that previously experienced natural hazard events and PPP loan allocations; however, this association is different based on the level of damage done by the natural hazard event. Furthermore, counties that had increased levels of economic risk, including measures of community resilience and the unemployment rate, receive less PPP loan allocations. We believe that the results of this study can potentially be helpful in decision-making regarding the allocation of recovery grants in future.

Citation

Environmental Research Letters

Pub Type

Journals

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Keywords

Complex events, Natural disasters, COVID-19 pandemic, PPP loans

Citation

Al Kajbaf, A. , Gore, C. , Helgeson, J. and Loerzel, J. (2024), Analysis of Natural Disasters and COVID-19 Pandemic Complex Impacts on Distribution of PPP Loans, Environmental Research Letters, [online], https://tsapps.nist.gov/publication/get_pdf.cfm?pub_id=957056 (Accessed January 13, 2025)