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The Impact of Temperature on Productivity and Labor Supply: Evidence from Indian Manufacturing
(with E. Somanathan, Meenu Tewari and Rohini Somanathan) |
Global Climate Change Research
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Hotter years are associated with lower economic output in country-level data. We show that the effect of temperature on labor is an important part of the explanation. Using high-frequency micro data from selected firms in India, we find that worker productivity on hot days declines by 2 to 4 percent per degree celsius. Sustained heat also increases worker absenteeism. Using a national panel of manufacturing plants, we find similar temperature effects on output and show that these can be fully accounted for by reductions in the productivity of labor. Estimated effect sizes are consistent with studies that rely on country GDP panels.
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Presentations and Papers
Working Paper, Aug 2018
Working Paper, Aug 2018
Related Media Coverage
Facing the Heat, Financial Express, July 2014
Facing the Heat, Financial Express, July 2014