Temperatures, Firm Size and Exports in Developing Countries

Températures, Taille des Firmes, et Exportations dans les Pays en Développement

Clément Nedoncelle

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Abstract: We study how temperature shocks affect exports in developing countries both at the firm-and aggregate-level. We find that while the average effect of temperature rise on exports is negative, small firms are disproportionately harmed compared with others. This feature is robust across subsamples, specifications and confounding factors. We show that this heterogeneity across firms has aggregate implications. In particular, we find that the overall trade deterring effect of temperatures would be significantly larger in absence of the largest exporters. We also show that firm structure matters for exports under future climate change scenarios, with large firms reducing the costs of predicted temperature rise. We conclude that the existing firm distribution in developing countries may increase the cost of climate change.

Keywords: Firm; structure (search for similar items in EconPapers)
Date: 2021-09-09
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Published in ETSG 2021 Ghent Twenty-second Annual Conference, European Trade Study Group, Sep 2021, Gand, Belgium

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03803308

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