Financial stability in response to climate change in a northern temperate economy

Kayla Stan, Graham A. Watt () and Arturo Sanchez-Azofeifa
Additional contact information
Kayla Stan: University of Alberta, Earth and Atmospheric Sciences Department, Centre for Earth Observation Sciences (CEOS)
Graham A. Watt: Royal Bank of Canada, Innovation & Technology, Climate Solutions
Arturo Sanchez-Azofeifa: University of Alberta, Earth and Atmospheric Sciences Department, Centre for Earth Observation Sciences (CEOS)

Nature Communications, 2021, vol. 12, issue 1, 1-10

Abstract: Abstract Climate change will have considerable impact on the global economy. Estimates of the economic damages due to climate change have focused on the effect of average temperature, but not the effect of other important climate variables. Related research has not explored the sub-annual economic cycles which may be impacted by climate volatility. To address these deficits, we propose a flexible, non-linear framework which includes a wide range of climate variables to estimate changes in GDP and project sub-annual economic cycle adjustments (period, amplitude, trough depth). We find that the inclusion of a more robust set of climate variables improves model performance by over 20%. Importantly, the improved model predicts an increase in GDP rather than a decrease when only temperature is considered. We also find that climate influences the sub-annual economics of all but one province in Canada. Highest stressed were the Prairie and Atlantic regions. Least stressed was the Southeastern region. Our study advances understanding of the nuances in the relationship between climate change and economic output in Canada. It also provides a method that can be applied to related economies globally to target adaptation and resilience management.

Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.nature.com/articles/s41467-021-27490-3 Abstract (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nat:natcom:v:12:y:2021:i:1:d:10.1038_s41467-021-27490-3

Ordering information: This journal article can be ordered from
https://www.nature.com/ncomms/

DOI: 10.1038/s41467-021-27490-3

Access Statistics for this article

Nature Communications is currently edited by Nathalie Le Bot, Enda Bergin and Fiona Gillespie

More articles in Nature Communications from Nature
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().