Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/318177 
Year of Publication: 
2022
Series/Report no.: 
BCAM Working Paper No. 2202
Publisher: 
Birkbeck, University of London, Birkbeck Centre for Applied Macroeconomics (BCAM), London
Abstract: 
We study the impact of climate volatility on economic growth exploiting data on 133 countries between 1960 and 2019. We show that the conditional (exante) volatility of annual temperatures increased steadily over time, rendering climate conditions less predictable across countries, with important implications for growth. Controlling for concomitant changes in temperatures, a +1oC increase in temperature volatility causes on average a 0.3 per cent decline in GDP growth and a 0.7 per cent increase in the volatility of GDP. Unlike changes in average temperatures, changes in temperature volatility affect both rich and poor countries.
Subjects: 
temperature volatility
economic growth
panel VAR
JEL: 
C32
E32
Q54
Document Type: 
Working Paper

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