Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/308344 
Year of Publication: 
2024
Series/Report no.: 
IZA Discussion Papers No. 17485
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We study the impact of climate change on the labor share. Using a newly constructed dataset combining US county-level labor shares with climate variables, we find that extreme temperatures reduce labor share. This adverse effect is more pronounced in industries with higher outdoor exposure and automation potential. We also show that extreme temperatures accelerate the adoption of industrial robots. Overall, climate change accounts for 14% of the decline in labor share during 2001–2019. In the last century, however, the opposing effects of decreased cold days and increased hot days offset each other, consistent with the well-documented constancy of labor share.
Subjects: 
climate change
labor share
automation
JEL: 
E25
Q54
O33
Document Type: 
Working Paper

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