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The effect of rainfall changes on economic production
Maximilian Kotz1,2, Anders Levermann1,2,3, Leonie Wenz4,5
1Research Department of Complexity Science, Potsdam Institute for Climate Impact Research, Potsdam, Germany.
Nature
|January 13, 2022
Summary
Economic growth is hindered by increased wet days and extreme rainfall, particularly in high-income nations and service sectors. Understanding daily rainfall distribution is crucial for assessing climate change economic impacts.
Area of Science:
- Climate Science
- Environmental Economics
- Macroeconomics
Background:
- Macro-economic assessments of climate impacts often overlook daily rainfall distribution.
- Daily rainfall patterns are critical for understanding complex societal impacts and climate change effects.
Purpose of the Study:
- To analyze the relationship between daily rainfall distribution and economic growth.
- To investigate how different sectors and income levels are affected by rainfall variations.
Main Methods:
- Utilized a global panel dataset of subnational economic output from 1,554 regions over 40 years.
- Examined the impact of wet day frequency, extreme daily rainfall, total annual rainfall, and monthly rainfall deviations on economic growth rates.
Main Results:
- Economic growth rates decrease with increased wet days and extreme daily rainfall.
- High-income nations and services/manufacturing sectors are most negatively impacted by daily rainfall measures.
- Results complement previous findings on the benefits of increased rainfall in low-income, agricultural economies.
Conclusions:
- Anthropogenic intensification of daily rainfall extremes will likely lead to negative global economic consequences.
- Assessing rainfall distribution across multiple timescales and sectors is essential for understanding climate-economy interactions.
- Further evaluation is needed to quantify the economic costs of climate change, considering daily rainfall impacts.
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