Temperature, productivity, and income

Olivier Deschenes

IZA World of Labor, 2023, No 505, 505

Abstract: Climate change is rapidly deteriorating environmental conditions through droughts and floods, hurricanes, wildfires, rising temperatures, and more frequent and longer heatwaves. A growing literature has shown how higher temperatures reduce worker productivity and economic output. These effects are more pronounced in poorer countries and in climate-exposed economic sectors like agriculture, construction, and manufacturing. The development of new technologies that mitigate exposure to heat among workers, combined with better temperature control in the workplace, will be essential to reduce the economic burden of climate change.

Keywords: extreme temperature; climate change; productivity; gross domestic product (search for similar items in EconPapers)
JEL-codes: F64 O44 P18 Q5 (search for similar items in EconPapers)
Date: 2023
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