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The Impact of Temperature on Productivity and Labor Supply: Evidence from Indian Manufacturing

Author

Listed:
  • Anant Sudarsan
  • E Somanathan
  • Rohini Somanathan

Abstract

Cross-country studies have found that hotter years are associated with lower output in poor countries. Using high-frequency micro-data from manufacturing firms in India, we show that worker heat stress can substantially explain this correlation. Ambient temperatures have non-linear e ffects on worker productivity, with declines on hot days of 4 to 9 percent per degree rise in temperature. Sustained heat also increases absenteeism. Similar temperature induced productivity declines are replicated in annual plant output from a national panel.

Suggested Citation

  • Anant Sudarsan & E Somanathan & Rohini Somanathan, 2015. "The Impact of Temperature on Productivity and Labor Supply: Evidence from Indian Manufacturing," Working Papers id:7086, eSocialSciences.
  • Handle: RePEc:ess:wpaper:id:7086
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    References listed on IDEAS

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    More about this item

    Keywords

    temperature; heat stress; worker productivity; climate change; absenteeism; plant output; poor countries; high frequency; micro data; India; correltion;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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