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Climate Amenities, Climate Change, and American Quality of Life

  • Albouy, David

    ()

    (University of Michigan)

  • Graf, Walter

    ()

    (University of California, Berkeley)

  • Kellogg, Ryan

    ()

    (University of Michigan)

  • Wolff, Hendrik

    ()

    (University of Washington)

We present a hedonic framework to estimate U.S. households' preferences over local climates, using detailed weather and 2000 Census data. We find that Americans favor an average daily temperature of 65 degrees Fahrenheit, will pay more on the margin to avoid excess heat than cold, and are not substantially more averse to extremes than to temperatures that are merely uncomfortable. These preferences vary by location due to sorting or adaptation. Changes in climate amenities under business-as-usual predictions imply annual welfare losses of 1 to 3 percent of income by 2100, holding technology and preferences constant.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7339.

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Length: 76 pages
Date of creation: Apr 2013
Date of revision:
Handle: RePEc:iza:izadps:dp7339
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