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Do temperature shocks affect non-agriculture wages in Brazil? Evidence from individual-level panel data

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  • Oliveira, Jaqueline
  • Palialol, Bruno
  • Pereda, Paula

Abstract

The relationship between temperature and agriculture outcomes in Brazil has been widely explored, overlooking the fact that most of the country's labor force is employed in non-agriculture sectors. We use monthly individual-level panel data spanning the period from January 2015 to December 2016 to ask whether temperature shocks impact non-agriculture wages in formal labor markets. Our results show that additional days in a month that fall within high-temperature ranges have significant adverse effects on real wages. Assuming a uniform climate change scenario where the daily temperature distribution shifts by 2$^{\circ }$C, we calculate income losses for formal workers in non-agriculture markets equivalent to 0.12 per cent of 2015 GDP.

Suggested Citation

  • Oliveira, Jaqueline & Palialol, Bruno & Pereda, Paula, 2021. "Do temperature shocks affect non-agriculture wages in Brazil? Evidence from individual-level panel data," Environment and Development Economics, Cambridge University Press, vol. 26(5-6), pages 450-465, October.
    • Handle: RePEc:cup:endeec:v:26:y:2021:i:5-6:p:450-465_3
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    Cited by:

    1. Brookes Gray, Harriet & Taraz, Vis & Halliday, Simon D., 2023. "The impact of weather shocks on employment outcomes: evidence from South Africa," Environment and Development Economics, Cambridge University Press, vol. 28(3), pages 285-305, June.
    2. Wei, Xiahai & Li, Jianan & Liu, Hongyou & Wan, Jiangtao, 2023. "Temperature and outdoor productivity: Evidence from professional soccer players," Journal of Asian Economics, Elsevier, vol. 87(C).

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