The Impact of Temperature on Productivity and Labor Supply: Evidence from Indian Manufacturing

Submitted by Ishita Datta on

Hotter years are associated with lower economic output in developing countries. The study shows that the effect of temperature on labor is an important part of the explanation. Using microdata from selected firms in India, the researchers estimate reduced worker productivity and increased absenteeism on hot days. Climate control significantly mitigates productivity losses. In a national panel of Indian factories, annual plant output falls by about 2% per degree Celsius. This response appears to be driven by a reduction in the output elasticity of labor.

Climate Change

Green economy reform - social inclusion and policy instrument support

Submitted by Petra Hansson on
EfD Authors:

Briefing highlights 

–    Analyzing policy attitudes is important for understanding environmental policy feasibility.

–    Pure self-interest is not sufficient to explain people’s policy positions. There are other factors that are also important for policy attitude formation.

–    Policy packaging, earmarking and revenue recycling can potentially change people’s policy positions.

Carbon Pricing, Climate Change, Policy Design