Abstract
This study analyzes the impact of climate change on economic growth for the top 20 countries in the world that cause the most carbon emissions. Following the Cobb–Douglas production function, we investigate the long-run relationships between temperature/precipitation and economic growth, capital stock, labor force, and productivity using static and dynamic panel data analyses for the period 1990–2019. The results from three different models are examined. Linear model test results reveal that temperature and precipitation do not have statistically any significant impact on economic growth in these countries. Nonlinear model test results indicate that the primary impact of temperature on economic growth is positive and statistically significant, whereas the secondary impact is negative and statistically significant. However, precipitation does not have any statistically significant impact on economic growth. Finally, the results of nonlinear model without control variables are similar to those of nonlinear model. The Dumitrescu and Hurlin panel causality test is also performed to check the consistency of static and dynamic panel estimations, and the results indicate bidirectional causality between temperature and economic growth but no causal relationship between precipitation and economic growth in these countries.
Highlights
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1.
Investigated the long-run relationship between economic growth and climate change.
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2.
Included the most polluting 20 countries in the world.
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3.
Negative impact of temperature on economic growth was determined.
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4.
Any significant effect of precipitation on economic growth was determined.
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Data Availability
The datasets generated and/or analyzed during the current study are available in the World Development Indicator (WDI) and the BP Statistical Review of World Energy databases. The datasets used and/or analyzed during the current study are also available from the corresponding author on reasonable request.
Notes
The economic growth rates (Y) were calculated using the equation \({\text{lnY}}={{\text{lnY}}}_{{\text{t}}}-{{\text{lnY}}}_{{\text{t}}-1}\).
Poland is not included in the analysis because it had missing data, and Canada and Russia had negative data in their series. The data set can be obtained from the authors upon request.
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MD: conceptualization, methodology, writing–original draft, analysis. FM: conceptualization, methodology, writing–review and editing, analysis. OK: conceptualization, methodology, writing–original draft, and analysis. AK: conceptualization, methodology, writing–original draft, and analysis.
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Doğanlar, M., Mike, F., Kızılkaya, O. et al. Temperature, Precipitation and Economic Growth: The Case of the Most Polluting Countries. Int J Environ Res 18, 4 (2024). https://doi.org/10.1007/s41742-023-00555-5
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DOI: https://doi.org/10.1007/s41742-023-00555-5