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Temperature and US Economic Activity: Evidence from Disaggregated Data

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  • Du, Ding
  • Zhao, Xiaobing

Abstract

We use sub-national data to examine the relationship between temperature and growth within the US and the European Union. Different from previous studies based on the country-level data, we find that the optimal temperature is much lower. Because most of production takes place in regions with temperatures above the optimal temperature, even modest temperature increases (e.g., 1 °C warming) have statistically and economically significant (negative) impact on the GDP growth of the US and the European Union. Our results suggest more proactive climate policy.

Suggested Citation

  • Du, Ding & Zhao, Xiaobing, 2016. "Temperature and US Economic Activity: Evidence from Disaggregated Data," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235105, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea16:235105
    DOI: 10.22004/ag.econ.235105
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    References listed on IDEAS

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    Keywords

    Environmental Economics and Policy;

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