Eye of the Storm: The Impact of Climate Shocks on Inflation and Growth

Cevik, Serhan

doi:10.5089/9798400241307.001

Cited by 12 publications

(2 citation statements)

References 80 publications

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“…The literature also shows that climate change has an impact on headline inflation, estimating the effect to lie between 0.3 and 2.6 percentage points (Ciccarelli et al, 2023;Iliyasu et al, 2023;Kabundi et al, 2022;Kotz et al, 2023;Mukherjee & Ouattara, 2021). According to findings by Natoli (2022) there is a small and at times non-significant deflationary effect of surprise temperature shocks on inflation in the U.S. A study by Cevik and Tovar Jalles (2023) conducted over the period from 1970 to 2020, and based on a sample of 173 countries, is the only example of an estimate that extreme temperatures result in lower headline inflation (a cumulative 3.5 percentage points over four years). Depending on the period and country under analysis, however, their findings show differences between headline prices and food prices.…”

Section: The Environmental and Climate Crisis And Price Stabilitymentioning

confidence: 99%

Greener and cheaper: green monetary policy in the era of inflation and high interest rates

Aguila,

Wullweber

2024

Eurasian Econ Rev

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In recent years central bankers have devoted increased attention to the question of whether and how to intervene to address the growing environmental and climate crisis. The climate intervention debate gained momentum during a period of low inflation and loose monetary policy in core economies – a time characterised by near zero interest rates and large asset purchase programmes. Since 2021, however, the macroeconomic context has changed. Against this background, the paper analyses the contradictory and problematic nature of the direction monetary policy has taken in reaction to higher inflation. It argues that higher interest rates delay the green transformation by raising the cost of sustainable investments, and that the resulting delay also hampers prospects for achieving price stability. The paper concludes that the present macroeconomic environment demands a ‘greener and cheaper’ monetary policy approach designed to address the environmental and climate crisis and also to simultaneously fight inflation.

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Section: The Environmental and Climate Crisis And Price Stabilitymentioning

confidence: 99%

Greener and cheaper: green monetary policy in the era of inflation and high interest rates

Aguila,

Wullweber

2024

Eurasian Econ Rev

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“…Faccia et al [10] analyze the impact of abnormal summer temperatures on inflation in developed and developing countries and show that high summer temperatures reduce inflation in the medium to long run. Cevik, S. [36] empirically examines the impact of temperature shocks on consumer price inflation using data from 173 countries over the period 1970-2020 and finds that temperature shocks reduce the level of inflation. Ciccarelli, M. [20] empirically examines the impact of temperature shocks on consumer price inflation using average temperature and temperature change as proxies for climate change and finds that higher average monthly temperatures generally increase inflation in the summer months while decreasing inflation in other seasons.…”

Section: Effects Of Climate Change On Inflationmentioning

confidence: 99%

Impact of Climate Change on Inflation in 26 Selected Countries

Li¹,

Zhang²,

He³

2023

Preprint

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In the era of persistent globalization, climate governance has emerged as a prominent concern within both the theoretical community and government departments of diverse nations. Of particular interest in academic research is the adverse effect of climate shocks on the global economy. This paper employs average temperature as a surrogate indicator for climate shocks and examines the influence of temperature fluctuations on inflation levels using a balanced panel dataset from 1995 to 2021. The findings indicate a positive association between temperature change and inflation within the country, which remains consistent even after subjecting the analysis to multiple robustness tests. Furthermore, accounting for heterogeneity reveals variations in the magnitude of response of inflation levels to temperature fluctuations. Regarding the analysis of underlying mechanisms, the study underscores the significance of energy demand as a pivotal pathway influencing inflationary pressures at the national level. Lastly, by incorporating GDP per capita as a threshold, the research reveals a nonlinear relationship between temperature change and inflation levels.

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Disaster induced displacement and durable solutions in Africa

Mateko,

Vutula

2024

Nat Hazards

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Climate change represents a significant challenge to the sustainability of the global economy. Many African countries have suffered the repercussions of environmental and climate deterioration, most notably internal displacement. This article sought to examine the impact of climate change within the context of internal displacement in Africa and to preview and describe the trends of internally displaced people in Africa. The study used a mixed methods approach. Qualitative data was obtained from online repositories, and it was analyzed using content analysis. Quantitative data was obtained from World Bank portal and it was analysed using descriptive statistics. Research findings have shown that Africa is plagued by a high number of internally displaced people. It was also established that climate change leads to income inequality, the exposure of people to poverty, and the destruction of infrastructure. These adverse effects affect the capacity of African economies to attain selected Sustainable Development Goals. In terms of policy recommendations, it was suggested that there is a need to strengthen the regional and continental bodies, invest in climate change adaptation measures, broaden the definition of refugees to include climate refugees, and promote robust research and capacity building.

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Eye of the Storm: The Impact of Climate Shocks on Inflation and Growth

Cited by 12 publications

References 80 publications

Greener and cheaper: green monetary policy in the era of inflation and high interest rates

Greener and cheaper: green monetary policy in the era of inflation and high interest rates

Impact of Climate Change on Inflation in 26 Selected Countries

Disaster induced displacement and durable solutions in Africa

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