NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Temperature and Human Capital in the Short- and Long-Run

Joshua S. Graff Zivin, Solomon M. Hsiang, Matthew J. Neidell

NBER Working Paper No. 21157
Issued in May 2015
NBER Program(s):   CH   EEE   HE   LS   PE

We provide the first estimates of the potential impact of climate change on human capital, focusing on the impacts from both short-run weather and long-run climate. Exploiting the longitudinal structure of the NLSY79 and random fluctuations in weather across interviews, we identify the effect of temperature in models with child-specific fixed effects. We find that short-run changes in temperature lead to statistically significant decreases in cognitive performance on math (but not reading) beyond 26C (78.8F). In contrast, our long-run analysis, which relies upon long-difference and rich cross-sectional models, reveals no statistically significant relationship between climate and human capital. This finding is consistent with the notion that adaptation, particularly compensatory behavior, plays a significant role in limiting the long run impacts from short run weather shocks.

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Document Object Identifier (DOI): 10.3386/w21157

 
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