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

Oussama Houari (), Hamza Bennani and Quentin Bro de Comères ()
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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
Quentin Bro de Comères: LéP [Poitiers] - Laboratoire d'économie de Poitiers - UP - Université de Poitiers = University of Poitiers

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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.

Keywords: Climate risks; natural language processing; local projections (search for similar items in EconPapers)
Date: 2024-05-02
Note: View the original document on HAL open archive server: https://nantes-universite.hal.science/hal-04565978v3
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