The Economic Impact of Weather and Climate

  title={The Economic Impact of Weather and Climate},
  author={Richard S. J. Tol},
  journal={Climate Action eJournal},
  • R. Tol
  • Published 2021
  • Economics
  • Climate Action eJournal
I propose a new conceptual framework to disentangle the impacts of weather and climate on economic activity and growth: A stochastic frontier model with climate in the production frontier and weather shocks as a source of inefficiency. I test it on a sample of 160 countries over the period 1950-2014. Temperature and rainfall determine production possibilities in both rich and poor countries; positively in cold countries and negatively in hot ones. Weather anomalies reduce inefficiency in rich… Expand
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