EGU General Assembly 2021
© Author(s) 2021. This work is distributed under
the Creative Commons Attribution 4.0 License.

Day-to-day temperature variability reduces economic growth

Maximilian Kotz1,2, Leonie Wenz1,3,4, Annika Stechemesser1,2, Matthias Kalkuhl3,5, and Anders Levermann1,2,6
Maximilian Kotz et al.
  • 1Potsdam Institute for Climate Impact Research, Complexity Science, Potsdam, Germany
  • 2Institute of Physics, Potsdam University, Germany
  • 3Mercator Research Institute on Global Commons and Climate Change, Berlin, Germany
  • 4Department of Agricultural and Resource Economics, University of California Berkeley, CA, USA
  • 5Faculty of Economic and Social Sciences, Potsdam University, Potsdam, Germany
  • 6Columbia University New York, NY, USA

Elevated annual average temperature has been found to impact macro-economic growth. However, various fundamental elements of the economy are affected by deviations of daily temperature from seasonal expectations which are not well reflected in annual averages. Here we show that increases in seasonally adjusted day-to-day temperature variability reduce macro-economic growth independent of and in addition to changes in annual average temperature. Combining observed day-to-day temperature variability with subnational economic data for 1,537 regions worldwide over 40 years in fixed-effects panel models, we find that an extra degree of variability results in a five percentage-point reduction in regional growth rates on average. The impact of day-to-day variability is modulated by seasonal temperature difference and income, resulting in highest vulnerability in low-latitude, low-income regions (12 percentage-point reduction). These findings illuminate a new, global-impact channel in the climate–economy relationship that demands a more comprehensive assessment in both climate and integrated assessment models.

How to cite: Kotz, M., Wenz, L., Stechemesser, A., Kalkuhl, M., and Levermann, A.: Day-to-day temperature variability reduces economic growth, EGU General Assembly 2021, online, 19–30 Apr 2021, EGU21-9973,, 2021.

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