Natural disasters and entrepreneurship activity

We propose that natural disasters discourage economic development in the short-run by inhibiting entrepreneurship start-up activity, which is largely responsible for job creation and growth. Our findings indicate that natural disaster events decrease start-up activity in the short-run (i.e., 1–2 years) but have no effect beyond that term. Furthermore, this relationship is driven by climatic natural disasters in low and middle-income countries and geologic disasters in high-income countries. •Natural disasters have been linked to disruptions in economic development.•We find that natural disasters decrease start-up activity in the short-run.•Climatic natural disasters affect start-up activity in low/middle income countries.•Geologic natural disasters affect start-up activity in high-income countries.•We find no effect beyond 1–2 years.