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    The macroeconomic cost of climate volatility

    Alessandri, Piergiorgio and Mumtaz, Haroon (2022) The macroeconomic cost of climate volatility. Working Paper. Birkbeck Centre for Applied Macroeconomics, London, UK.

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    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.


    Item Type: Monograph (Working Paper)
    Additional Information: BCAM Working Paper #2202. ISSN: 1745-8587
    Keyword(s) / Subject(s): temperature volatility, economic growth, panel VAR
    School: Birkbeck Faculties and Schools > Faculty of Business and Law > Birkbeck Business School
    Research Centres and Institutes: Applied Macroeconomics, Birkbeck Centre for
    Depositing User: Isobel Edwards
    Date Deposited: 25 Mar 2022 13:51
    Last Modified: 02 Aug 2023 18:15


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