Rising Temperature, Nuanced Effects: Evidence from Seasonal and Sectoral Data

IMF Working Papers, September 20, 2024

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Canonical URL: Rising Temperature, Nuanced Effects: Evidence from Seasonal and Sectoral Data

Study uses quarterly temperature and sectoral value-added data for a large sample of advanced economies (AEs) and emerging markets and developing economies (EMDEs).
Investigates seasonal (spring, summer, winter) temperature effects on growth in real value-added across sectors: agriculture, manufacturing, services.

EMDEs:
- Hotter spring and summer temperatures reduce growth in real value-added of manufacturing.
- The reduction is most significant for agriculture.
- A warmer winter boosts growth in real value-added (sector unspecified beyond context).
Advanced economies (AEs):
- A hotter spring hurts growth in real value-added of all considered sectors: services, manufacturing, and agriculture.
General patterns for both country groups:
- The negative effect of a hotter spring is larger and more persistent than the positive effect of a warmer winter.
Temporal development:
- The adverse impacts of hotter temperatures in advanced economies have accentuated in recent decades, suggesting increased vulnerability to rising temperatures.

Subject: Agricultural sector, Climate change, Economic sectors, Emerging and frontier financial markets, Environment, Financial markets, Manufacturing
Keywords: Agricultural sector, agriculture, climate change, economic growth, Emerging and frontier financial markets, emerging markets and developing economies, Global, IMF working paper 24/202, Manufacturing, quarterly temperature, seasonal temperature, summer temperature, temperature