Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/312052 
Year of Publication: 
2024
Series/Report no.: 
CESifo Working Paper No. 11542
Publisher: 
CESifo GmbH, Munich
Abstract: 
This paper examines the role of positive income shocks in helping workers adapt to extreme temperatures. We use daily temperature variations alongside the exogenous implementation of a wage and fiscal policy in Mexican municipalities along the US border to show that increased disposable income significantly reduces temperature-related mortality in treated areas. Exploring the mechanisms, we find that income gains increase households' adaptive capacity, particularly through higher electricity expenditures and the purchase of electric heaters. Our findings provide causal estimates of how income influences the marginal effect of temperature on mortality and contribute to the debate on the effectiveness of climate-related redistribution policies.
Subjects: 
temperature
mortality
distributional effects
public policies
minimum wage
JEL: 
Q51
Q58
J81
J88
Document Type: 
Working Paper
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