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Climate Risks and Economic Activity in France: Evidence from Media Coverage

Author

Listed:
  • Oussama Houari

    (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université)

  • Hamza Bennani

    (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université)

  • Quentin Bro de Comères

    (LéP [Poitiers] - Laboratoire d'économie de Poitiers - UP - Université de Poitiers = University of Poitiers)

Abstract

This study investigates the impact of climate risks on economic activity in France. Using natural language processing methods on three major French newspapers (Le Monde, Les Echos, and Le Figaro) in 2000-2023, we construct a measure of climate risks that we disentangle into physical- and transition-risk components. Our findings highlight several transmission channels through which climate risks affect the economy: the business cycle channel, the precautionary savings channel, the inflation channel, and the banking/credit channel. Moreover, while we document the existence of heterogeneous responses to our measures of physical and transition risks, we find that the tone of media covering climate risks matters beyond the frequency of published articles. Our findings show that the media plays a crucial role in influencing public beliefs about climate change related issues.

Suggested Citation

  • Oussama Houari & Hamza Bennani & Quentin Bro de Comères, 2024. "Climate Risks and Economic Activity in France: Evidence from Media Coverage," Working Papers hal-04565978, HAL.
    • Handle: RePEc:hal:wpaper:hal-04565978
    Note: View the original document on HAL open archive server: https://nantes-universite.hal.science/hal-04565978v3
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    More about this item

    Keywords

    Climate risks; natural language processing; local projections;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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