Precipitation and Economic Growth

54 Pages Posted: 31 Oct 2018

See all articles by Michael Berlemann

Michael Berlemann

University of the German Federal Armed Forces - Department of Economics

Daniela Wenzel

University of the German Federal Armed Forces - Helmut Schmidt Universit├Ąt

Date Written: 2018

Abstract

As the ongoing process of global warming goes along with changes in both mean precipitation and precipitation extremes, the scientific interest in the effects of rainfall on economic prosperity has recently grown significantly. However, the few existing empirical studies of short-run growth effects of precipitation deliver inconclusive results. The medium- and long-run growth perspective is yet mostly unexplored. In this paper we deliver a systematic analysis of the short- and long-run growth effects of rainfall based on a large panel dataset covering more than 150 countries over the period of 1951 to 2013. We find strong and highly robust empirical evidence for long-lasting negative growth effects of rainfall shortages in poor and underdeveloped countries, which are not driven by the subsample of Sub Saharan African countries.

Keywords: economic growth, precipitation

JEL Classification: O440, Q540, Q560, F630

Suggested Citation

Berlemann, Michael and Wenzel, Daniela, Precipitation and Economic Growth (2018). CESifo Working Paper No. 7258. Available at SSRN: https://ssrn.com/abstract=3275432

Michael Berlemann (Contact Author)

University of the German Federal Armed Forces - Department of Economics ( email )

Holstenhofweg 85
Hamburg, 22043
Germany

Daniela Wenzel

University of the German Federal Armed Forces - Helmut Schmidt Universit├Ąt ( email )

Holstenhofweg 85
Hamburg, 22008
Germany

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