The impact of climate change on economic output across industries in Chile

Hernández, Karla and Madeira, Carlos (2021): The impact of climate change on economic output across industries in Chile. Published in: PLoS ONE , Vol. 4, No. 17 (28 April 2022): pp. 1-21.

Abstract

Using region-industry panel data for Chile over the period 1985 to 2017, we find no effect of precipitation changes on GDP and a negative impact of higher summer temperatures on Agriculture-Silviculture and Fishing. An increase of one Celsius degree in the month of January implies a 3% and 12% GDP reduction in Agriculture and Fishing, respectively. There is also a negative effect of higher temperatures in January on Construction and Electricity, Gas, and Water. Our analysis suggests that climate change did not have a big impact on the Chilean economy during this period. Stress test exercises that select only the negative and statistically significant coefficients imply that the Chilean GDP would fall between -14.8% and -9% in 2050 and between -29.6% and -16.8% in 2100, according to our model.

• Item Type: MPRA Paper
• Language: English
• Keywords: climate change; economic damages from climate change; economic growth; global warming; Chile; Latin America
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O44 - Environment and Growth; O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O54 - Latin America ; Caribbean; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q51 - Valuation of Environmental Effects; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q59 - Other; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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