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Temperature, productivity, and income

Author

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  • Olivier Deschenes

    (University of California Santa Barbara, USA, and IZA, Germany)

Abstract

Climate change is rapidly deteriorating environmental conditions through droughts and floods, hurricanes, wildfires, rising temperatures, and more frequent and longer heatwaves. A growing literature has shown how higher temperatures reduce worker productivity and economic output. These effects are more pronounced in poorer countries and in climate-exposed economic sectors like agriculture, construction, and manufacturing. The development of new technologies that mitigate exposure to heat among workers, combined with better temperature control in the workplace, will be essential to reduce the economic burden of climate change.

Suggested Citation

  • Olivier Deschenes, 2023. "Temperature, productivity, and income," IZA World of Labor, Institute of Labor Economics (IZA), pages 505-505, February.
    • Handle: RePEc:iza:izawol:journl:2023:n:505
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    References listed on IDEAS

    as
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    4. Riccardo Colacito & Bridget Hoffmann & Toan Phan, 2019. "Temperature and Growth: A Panel Analysis of the United States," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 51(2-3), pages 313-368, March.
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    6. Chang, Tom Y. & Kajackaite, Agne, 2019. "Battle for the thermostat: Gender and the effect of temperature on cognitive performance," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 14(5), pages 1-10.
    7. Kalkuhl, Matthias & Wenz, Leonie, 2020. "The impact of climate conditions on economic production. Evidence from a global panel of regions," Journal of Environmental Economics and Management, Elsevier, vol. 103(C).
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    9. Solomon M. Hsiang & Amir S. Jina, 2014. "The Causal Effect of Environmental Catastrophe on Long-Run Economic Growth: Evidence From 6,700 Cyclones," NBER Working Papers 20352, National Bureau of Economic Research, Inc.
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    More about this item

    Keywords

    extreme temperature; climate change; productivity; gross domestic product;
    All these keywords.

    JEL classification:

    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • P18 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Energy; Environment
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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