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The Impact Of Temperature On Productivity And Labor Supply - Evidence From Indian Manufacturing

Author

Listed:
  • Anant Sudarshan

    (Department of Economics, University of Chicago and Energy Policy Institute at Chicago)

  • E. Somanathan

    (Economics and Planning Unit, Indian Statistical Institute)

  • Rohini Somanathan

    (Departments of Economics, Delhi School of Economics, University of Delhi, India)

  • Meenu Tewari

    (University of North Carolina, Chapel Hill)

Abstract

Cross-country studies have found that hotter years are associated with lower output in poor countries. Using high-frequency micro-data from manufacturing firms in India, we show that worker heat stress can substantially explain this correlation. Ambient temperatures have non-linear effects on worker productivity, with declines on hot days of 4 to 9 percent per degree rise in temperature. Sustained heat also increases absenteeism. Similar temperature induced productivity declines are replicated in annual plant output from a national panel. Our estimates imply that warming between 1971 and 2009 may have decreased manufacturing output in India by at least 3 percent relative to a no-warming counterfactual.

Suggested Citation

  • Anant Sudarshan & E. Somanathan & Rohini Somanathan & Meenu Tewari, 2015. "The Impact Of Temperature On Productivity And Labor Supply - Evidence From Indian Manufacturing," Working papers 244, Centre for Development Economics, Delhi School of Economics.
    • Handle: RePEc:cde:cdewps:244
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    References listed on IDEAS

    as
    1. Sanghamitra Das & Kala Krishna & Sergey Lychagin & Rohini Somanathan, 2013. "Back on the Rails: Competition and Productivity in State-Owned Industry," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 136-162, January.
    2. repec:adr:anecst:y:2005:i:79-80:p:12 is not listed on IDEAS
    3. Zhang, Peng & Deschenes, Olivier & Meng, Kyle & Zhang, Junjie, 2018. "Temperature effects on productivity and factor reallocation: Evidence from a half million chinese manufacturing plants," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 1-17.
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    More about this item

    Keywords

    temperature; heat stress; worker productivity; climate change;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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