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Does Hotter Temperature Increase Poverty and Inequality ? Global Evidence from SubnationalData Analysis

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  • Dang,Hai-Anh H.
  • Nguyen,Minh Cong
  • Trinh,Trong-Anh
Abstract
Despite a vast literature documenting the harmful effects of climate change on varioussocio-economic outcomes, little evidence exists on the global impacts of hotter temperature on poverty andinequality. Analysis of a new global panel dataset of subnational poverty in 134 countries finds that a one-degreeCelsius increase in temperature leads to a 9.1 percent increase in poverty, using the US$1.90 daily povertythreshold. A similar increase in temperature causes a 1.4 percent increase in the Gini inequality index. The paperalso finds negative effects of colder temperature on poverty and inequality. Yet, while poorer countries—particularlythose in South Asia and Sub-Saharan Africa—are more affected by climate change, household adaptation could have mitigatedsome adverse effects in the long run. The findings provide relevant and timely inputs for the global fight againstclimate change as well as the current policy debate on the responsibilities of richer countries versus poorer countries.

Suggested Citation

  • Dang,Hai-Anh H. & Nguyen,Minh Cong & Trinh,Trong-Anh, 2023. "Does Hotter Temperature Increase Poverty and Inequality ? Global Evidence from SubnationalData Analysis," Policy Research Working Paper Series 10466, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10466
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    References listed on IDEAS

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    1. Marshall Burke & Kyle Emerick, 2016. "Adaptation to Climate Change: Evidence from US Agriculture," American Economic Journal: Economic Policy, American Economic Association, vol. 8(3), pages 106-140, August.
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    Cited by:

    1. Swapnanil SenGupta & Aakansha Atal, 2024. "Income inequality in the face of climate change: an empirical investigation on unequal nations, vulnerable regions and India," SN Business & Economics, Springer, vol. 4(8), pages 1-33, August.
    2. Pardy, Martina & Riom, Capucine & Hoffmann, Roman, 2024. "Climate impacts on material wealth inequality: global evidence from a subnational dataset," LSE Research Online Documents on Economics 125447, London School of Economics and Political Science, LSE Library.

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    More about this item

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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