Temperature and US Economic Activity: Evidence from Disaggregated Data

Ding Du and Xiaobing Zhao

No 235105, 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts from Agricultural and Applied Economics Association

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.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 27
Date: 2016
New Economics Papers: this item is included in nep-env and nep-gro
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea16:235105

DOI: 10.22004/ag.econ.235105

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