Climate Change, Mortality and Adaptation: Evidence from Annual Fluctuations in Weather in the U.S.

57 Pages Posted: 25 Jun 2007 Last revised: 30 Nov 2013

Olivier Deschenes

University of California, Santa Barbara - College of Letters & Science - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Michael Greenstone

University of Chicago - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: June 21, 2007

Abstract

This paper produces the first large-scale estimates of the US health related welfare costs due to climate change. The full welfare impact will be reflected in health outcomes and increased consumption of goods that preserve individuals' health. Using the presumably random year-to-year variation in temperature and two state of the art climate models, the analysis suggests that under a 'business as usual' scenario climate change will lead to an increase in the overall US annual mortality rate of approximately 2% at the end of the 21st century. Among different age groups, the estimated mortality increases are largest for infants. Individuals are likely to respond to higher temperatures by increasing air conditioning usage; the analysis suggests that climate change will lead to increases in annual residential energy consumption of up to 32% by the end of the century. Overall, the estimates suggest that the present discounted value of willingness to pay to avoid the climate change induced mortality and energy impacts predicted to occur over the remainder of the 21st century is about $900 billion (2006$) or 6.8% of 2006 GDP. This estimate of willingness to pay is statistically insignificant and is likely to overstate the long-run costs of climate change on these outcomes, because climate change will unfold gradually and individuals can engage in a wider set of adaptations that will mitigate costs in the longer run.

Keywords: health costs of climate change, mortality due to hot and cold temperatures, adaptation to climate change, impact of climate change on energy demand, forward displacement of fatalities, health production functions

JEL Classification: I10, I12, I18, Q41, Q51, Q54, H4

Suggested Citation

Deschenes, Olivier and Greenstone, Michael, Climate Change, Mortality and Adaptation: Evidence from Annual Fluctuations in Weather in the U.S. (June 21, 2007). MIT Department of Economics Working Paper No. 07-19. Available at SSRN: https://ssrn.com/abstract=995830 or http://dx.doi.org/10.2139/ssrn.995830

Olivier Deschenes

University of California, Santa Barbara - College of Letters & Science - Department of Economics ( email )

Santa Barbara, CA 93106
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Michael Greenstone (Contact Author)

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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