Yanjun (Penny) Liao

Postdoctoral Research Fellow

The Wharton School


I am an applied microeconomist at the Wharton Risk Management and Decision Processes Center. I am primarily interested in behavioral and market responses to extreme weather events and environmental risks, and how policies can be designed to facilitate efficient adaptation. In a related research agenda, I study consumer behavior regarding energy-efficient technologies and renewables.

Click here for my full CV.


  • Environmental and Energy Economics
  • Public Economics


  • Ph.D. in Economics, 2019

    University of California, San Diego

  • B.A. in Economics, 2013

    University of Hong Kong



“Weather and the Decision to Go Solar: Evidence on Costly Cancellations” Journal of the Association of Environmental and Resource Economists, no.1 (January 2020): 1-33. [ Manuscript, Online Appendix ]

Working Papers

“The Fiscal Impacts of Wildfires on California Municipalities” (with Carolyn Kousky)
Current version: May 2020. In submission.

This paper provides some of the first empirical estimates of the impact of natural disasters on the sub-components of municipal budgets. We combine detailed municipal financial data from 1990-2015 with data on historical wildfire perimeters in California. We find that wildfires increase both revenues and expenditures. Sales taxes temporarily increase and property taxes increase to a permanently higher level; this appears due to state law that limits reassessments of property until time of sale. Wildfires also cause a long-term increase in local spending on preparedness and planning. The overall impact of wildfires on municipal budgets is negative and substantial.

“Extreme Weather and the Politics of Climate Change: a Study of Campaign Contributions and Elections” (with Pablo Ruiz Junco)
Current version: May 2020. Revise and resubmit at Journal of Environmental Economics and Management.

In this paper, we study how extreme weather and natural disasters affect political outcomes such as campaign contributions and elections. Weather events associated with climate change may influence these outcomes by leading voters to re-evaluate the incumbent politician’s environmental position. In a short-run analysis, we find that the number of online contributions to the Democratic Party increases in response to higher weekly temperature, and that the effect is stronger in counties with more anti-environment incumbent politicians. In a medium-run analysis we find evidence that, when a natural disaster strikes, the election becomes more competitive if the incumbent has a more anti-environment stance: total campaign contributions increase for both candidates but skewed towards the challenger, the race is more likely to be contested, and the incumbent is less likely to be re-elected. Finally, we address alternative mechanisms and explanations for our results.

“How Hurricanes Sweep Up Housing Markets: Evidence from Florida” (with Joshua Graff Zivin and Yann Panassi√©)
Current version: July 2020. In submission.

This paper examines the impacts of hurricanes on the housing market and the associated implications for local population turnover. We directly characterize equilibrium dynamics in the housing market using micro-level estimates. For this purpose, we assemble a comprehensive dataset by combining housing transactions, parcel tax assessments, and hurricane history in Florida during 2000-2016. Our results show that hurricanes cause an increase in equilibrium prices and a concurrent decrease in the probability of transaction for homes in affected areas, both lasting up to three years. Together, these dynamics imply a negative transitory shock to the housing supply as a consequence of the hurricane. Furthermore, we match buyer characteristics from mortgage applicationsto provide the first buyer-level evidence on population turnover. We find that incoming homeowners in this period have higher incomes, leading to an overall shift in thelocal economic profile toward higher-income groups. Our findings suggest that market responses to destructive natural disasters can lead to uneven and lasting demographicchanges in affected communities, even with a full recovery in physical capital.

“What’s at Stake? Understanding the Role of Home Equity in Flood Insurance Demand” (with Philip Mulder)
Draft coming soon.

Work in Progress

“Negative Rebound: Fuel Economy Standards and Miles Traveled” (with Mark Jacobsen)

“Sea Level Rise and the Social Cost of Flood Insurance Subsidies” (with Terrence Iverson and Niko Jaakkola)


Graduate Courses

  • ECON 281: Economics of the Environment (2016, 2017, Scripps Institute of Oceanography, UCSD)
    Co-instructor with Mark Jacobsen

  • GPEC 488: Environmental and Regulatory Economics (2017, School of Global Policy and Strategy, UCSD)
    Co-instructor with Joshua Graff Zivin

Undergraduate Courses

  • ECON 120A/B: Econometrics (2014-2019)
  • ECON 5: Data Analytics/Social Sciences (2018)
  • ECON 152: Public Economics (2018)
  • ECON 1: Principles of Microeconomics (2015, 2018)
    Teaching assistant at the Department of Economics, UCSD

Teaching Interests

  • Econometrics (R/Stata)
  • Economics of Climate Change
  • Environmental Economics