Working Paper: NBER ID: w31327
Authors: Kimberly A. Berg; Chadwick C. Curtis; Nelson Mark
Abstract: We use local projections to estimate the cross-country distribution of real GDP per capita growth impulse responses to global and idiosyncratic temperature shocks. Negative growth responses to global temperature at longer horizons are found for all Group of Seven countries while positive responses are found for seven of the nine poorest countries. Global temperature shocks have negative effects on growth for around half of the countries and seemingly anomalous positive effects for the other half. After controlling for latitude and average temperature, positive growth responses to global temperature shocks are more likely for countries that are poorer, have experienced slower growth, are less educated (lower high school attainment), less open to trade, and more authoritarian.
Keywords: GDP; Temperature; Cross-Country Response; Local Projections
JEL Codes: E23; O13; O50
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| global temperature shocks (Q54) | GDP growth (O49) |
| idiosyncratic temperature shocks (E39) | GDP growth (O49) |
| global temperature shocks (Q54) | negative growth responses for G7 countries (F69) |
| global temperature shocks (Q54) | positive growth responses for poorer countries (O57) |
| country characteristics (O57) | responses to global temperature shocks (F69) |
| temperature fluctuations (E32) | GDP growth (O49) |