Climate and Scale in Economic Growth

Posted: 12 Nov 2001

See all articles by William A. Masters

William A. Masters

Tufts University - Friedman School of Nutrition Science and Policy; Tufts University - Department of Economics

Margaret McMillan

Tufts University - Department of Economics; International Food Policy Research Institute (IFPRI); National Bureau of Economic Research (NBER)

Abstract

This paper introduces new data on climatic conditions to empirical tests of growth theories. We find that, since 1960, temperate countries have converged towards high levels of income while tropical nations have converged towards various income levels associated with economic scale and the extent of the market. These results hold for a wide range of tests. A plausible explanation is that temperate regions' growth was assisted by their climate, perhaps historically for their transition out of agriculture into sectors whose productivity converges across countries, while tropical countries' growth is relatively more dependent on gains from specialization and trade.

Keywords: growth accounting, empirical growth, endogenous growth

JEL Classification: F43, 040

Suggested Citation

Masters, William A. and McMillan, Margaret, Climate and Scale in Economic Growth. Available at SSRN: https://ssrn.com/abstract=290178

William A. Masters (Contact Author)

Tufts University - Friedman School of Nutrition Science and Policy ( email )

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Boston, MA 02111
United States

HOME PAGE: http://sites.tufts.edu/willmasters

Tufts University - Department of Economics ( email )

Medford, MA 02155
United States

Margaret McMillan

Tufts University - Department of Economics ( email )

Medford, MA 02155
United States

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

National Bureau of Economic Research (NBER) ( email )

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Cambridge, MA 02138
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