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The Climate Trap of Health Development: Empirical Analysis of the Effects of Climate and Income on Mortality

Kam Ki Tang (), Dennis Petrie () and D.S. Prasada Rao

No 1908, MRG Discussion Paper Series from School of Economics, University of Queensland, Australia

Abstract: This paper examines the dynamic relationship between climate, health, and income. We partition the effects of climate and income on mortality into the pure climate effect, the pure income effect, and the overlapping effect, and show that African countries exhibit a large pure climate effect but a negligible pure income effect, while non-African countries exhibit the opposite pattern. We provide further empirical evidence that while climate is important in determining both health and income, income can in turn provide a shield against the adverse effects of climate on health. This interaction between climate, income and health can give rise to either a virtuous cycle of prosperity or a vicious cycle of poverty. The findings have important implications in the context of climate change, as global warming is likely bringing about a worsening of climatic conditions in poorer countries that could see many of them sinking deeper into a climate trap of underdevelopment in health.

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