Abstract

Natural disaster losses can be mitigated through investments in structure hardening. When property owners do not correctly perceive risks or there are spatial externalities, it may be beneficial to mandate such investments through building codes. We provide the first comprehensive evaluation of the effect of California’s wildfire building codes on structure survival. We combine administrative damage data from several states, representing almost all U.S. homes destroyed by wildfire since 2007. We merge this damage data to the universe of assessor data for destroyed and surviving homes inside wildfire perimeters. There are remarkable vintage effects in resilience for California homes built after 1995. Using differences in code requirements across jurisdictions, we show that these vintage effects are due to state and local building code changes prompted by the deadly 1991 Oakland Firestorm. Moreover, we find that these improvements increase the survival probability of neighboring homes due to reduced structure-to-structure spread. Our results imply that property losses during recent wildfire seasons would have been several billion dollars smaller if all older homes had been built to current standards.