Forecasting More than Three Centuries of Economic Growth of the United Kingdom: The Role of Climate Risks

Hardik Marfatia (), Rangan Gupta, Goodness Aye () and Christian Pierdzioch
Additional contact information
Hardik Marfatia: Department of Economics, Northeastern Illinois University, BBH 344G, 5500 N. St. Louis Avenue, Chicago, IL 60625, USA
Goodness Aye: Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa

No 202238, Working Papers from University of Pretoria, Department of Economics

Abstract: In this paper, we focus on forecasting economic growth of the United Kingdom (UK) based on information content of climate-related risks, proxied by growth of temperature and its volatility, over and above, macroeconomic, financial market, and policy-based uncertainties. Using over three centuries of data, 1701 to 2020, we undertake a dynamic model averaging/selection (DMA/DMS) approach to forecast at one-, five-, and ten-year-ahead horizons. We find that climate risks provide superior forecasts for short- and long-term economic growth, over and above those obtained by other dimensions of uncertainty, in particular during the 20th and 21st centuries.

Keywords: Growth; Climate Risks; Uncertainties; Time-Varying Models; Forecasting (search for similar items in EconPapers)
JEL-codes: C22 C53 D80 O40 Q54 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2022-08
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:pre:wpaper:202238

Access Statistics for this paper

More papers in Working Papers from University of Pretoria, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Rangan Gupta ().