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Climate Shift Uncertainty and Economic Damages

Author

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  • Romain Fillon
  • Manuel Linsenmeier
  • Gernot Wagner

Abstract

Focusing on global annual averages of climatic variables can bias aggregate and distributional estimates of the economic impacts of climate change. We here empirically identify dose-response functions of GDP growth rates to daily mean temperature levels and combine them with regional intra-annual climate projections of daily mean temperatures. We then disentangle, for various shared socio-economic pathways (SSPs), how much of the missing impacts are due to heterogeneous warming patterns over space. Global damages in 2050 are 25% (21-28% across SSPs) higher when accounting for the shift in the shape of the entire intra-annual distribution of daily mean temperatures at the regional scale.

Suggested Citation

  • Romain Fillon & Manuel Linsenmeier & Gernot Wagner, 2025. "Climate Shift Uncertainty and Economic Damages," CESifo Working Paper Series 12289, CESifo.
    • Handle: RePEc:ces:ceswps:_12289
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    Keywords

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    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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