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Does hotter temperature increase poverty and inequality? Global evidence from subnational data analysis

Dang, Hai-Anh H., Cong Nguyen, Minh and Trinh, Trong-Anh (2023) Does hotter temperature increase poverty and inequality? Global evidence from subnational data analysis. III Working Papers (104). International Inequalities Institute, London School of Economics and Political Science, London, UK.

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Despite a vast literature documenting the harmful effects of climate change on various socioeconomic outcomes, little evidence exists on the global impacts of hotter temperature on poverty and inequality. Analysis of a new global panel dataset of subnational poverty in 134 countries finds that a one-degree Celsius increase in temperature leads to a 9.1 percent increase in poverty, using the US$1.90 daily poverty threshold. A similar increase in temperature causes a 1.4 percent increase in the Gini inequality index. The paper also finds negative effects of colder temperature on poverty and inequality. Yet, while poorer countries—particularly those in South Asia and Sub-Saharan Africa—are more affected by climate change, household adaptation could have mitigated some adverse effects in the long run. The findings provide relevant and timely inputs for the global fight against climate change as well as the current policy debate on the responsibilities of richer countries versus poorer countries.

Item Type: Monograph (Working Paper)
Official URL:
Additional Information: © 2023 The Author(s)
Divisions: International Inequalities Institute
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HC Economic History and Conditions
G Geography. Anthropology. Recreation > GE Environmental Sciences
JEL classification: Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q54 - Climate; Natural Disasters
I - Health, Education, and Welfare > I3 - Welfare and Poverty > I32 - Measurement and Analysis of Poverty
O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O10 - General
Date Deposited: 05 Sep 2023 14:57
Last Modified: 16 May 2024 12:31

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