Burning growth: rising temperatures in a growth-at-risk approach: a case study of Colombia

Camilo, Camila; Rozada, Angie; Sanz, Carlos

Burning growth: rising temperatures in a growth-at-risk approach: a case study of Colombia

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Camilo, C, Rozada, A, Sanz, C. Burning growth: rising temperatures in a growth-at-risk approach: a case study of Colombia. 2022. handle: http://hdl.handle.net/10230/55221

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Abstract

The rise in global temperatures have been a growing source of concern for policy makers given its potential impact for sustainable economic activity. This paper explores the effects of a temperature shock on the distribution of economic growth in Colombia. Specifically, it focuses on the impact of these shocks on economic risks. The findings suggest the existence of asymmetries on the lower and upper tail of the distribution, indicating that higher temperatures leads to less optimistic outcomes for GDP growth. Also, it is found negative and significant effects of temperature shocks on non-agricultural sectors. The results are obtained using quantile regressions under the Growth-at-risk approach and local projections.