The impact of temperature on productivity and labor supply: Evidence from Indian manufacturing

Arbeitspapier

Hotter years are associated with lower economic output in developing countries. We show that the effect of temperature on labor is an important part of the explanation. Using microdata from selected firms in India, we estimate reduced worker productivity and increased absenteeism on hot days. Climate control significantly mitigates productivity losses. In a national panel of Indian factories, annual plant output falls by about 2% per degree Celsius. This response appears to be driven by a reduction in the output elasticity of labor. Our estimates are large enough to explain previously observed output losses in cross-country panels.

Object Details

• ISBN: 978-3-96973-056-0
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Ruhr Economic Papers ; No. 912

Classification and Topics

• Classification: Wirtschaft ; Climate; Natural Disasters and Their Management; Global Warming ; Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth ; Time Allocation and Labor Supply ; Human Capital; Skills; Occupational Choice; Labor Productivity
• Subject: Temperature ; warming ; labor productivity ; labor supply

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Somanathan, E. ; Somanathan, Rohini ; Sudarshan, Anant ; Tewari, Meenu
• Event: Veröffentlichung
• (who): RWI - Leibniz-Institut für Wirtschaftsforschung
• (where): Essen
• (when): 2021

Further information

• DOI: doi:10.4419/96973056
• Handle: http://hdl.handle.net/10419/234957
• Last update: 10.03.2025, 11:43 AM CET