Natural Hazards

, Volume 95, Issue 1–2, pp 289–308 | Cite as

The economic impact of climate risks in China: evidence from 47-sector panel data, 2000–2014

  • Yongping Sun
  • Xin Zou
  • Xunpeng Shi
  • Ping ZhangEmail author
Original Paper


Climate risks have significant economic impacts on the various sectors of an economy through direct and indirect channels. When aggregated, their impact can be underestimated or overestimated. This paper examines the impact of five types of climate risks on 47 sectors in China from 2000 to 2014 through the application of a threshold model. We find that: (1) the impact of the integrated climate risks index on sector output is linear. While rainstorms show a U-shaped relationship with output, the other four types of risks—droughts, typhoons, high temperatures and low temperatures freezing—have an inverted U-shaped relationship. (2) Climate risks indirectly influence sector output through capital stock in a significantly positive way. (3) The proportion of intermediate inputs leads to significant differences in the impact of climate risks on sectors. The results suggest that climate policies need to be sector- and risk-specific, as well as dynamic.


Climate risks Sector output Capital stock Intermediate inputs 



This work was supported by the Major Projects of the National Social Science Foundation of Research on “Supply-side Structural Reform and New Developing Impetus” (Grant No. 16ZDA006), National Social Science Foundation of Research on “Study of Measurement of Statistical Misreporting and Correction Mechanism: Based on Incentive of Local Government” (Grant No. 17BJL070), Humanity and Social Science Youth Foundation of the Ministry of Education in China on “GDP Misreporting and Formation Mechanism under Official Evaluation: Study Based on Satellite Light Data” (Grant No. 16YJC790136) and Humanity and Social Science Youth Foundation of the Ministry of Education in China on“The Effects and Mechanism of Producer Services Cluster on Carbon Emissions EfficiencyofManufacturingin China” (Grant No. 18YJC790103).


  1. Ascione F (2017) Energy conservation and renewable technologies for buildings to face the impact of the climate change and minimize the use of cooling. Sol Energy 154:34–100. CrossRefGoogle Scholar
  2. Auffhammer M, Mansur ET (2014) Measuring climatic impacts on energy consumption: a review of the empirical literature. Energy Econ 46:522–530. CrossRefGoogle Scholar
  3. Barreca A, Clay K, Deschenes O, Greenstone M, Shapiro J (2016) Adapting to climate change: the remarkable decline in the US temperature-mortality relationship over the twentieth century. J Political Econ 124:105–159. CrossRefGoogle Scholar
  4. Beermann M (2011) Linking corporate climate adaptation strategies with resilience thinking. J Clean Prod 19:836–842. CrossRefGoogle Scholar
  5. Cruz AM, Krausmann E (2013) Vulnerability of the oil and gas sector to climate change and extreme weather events. Clim Change 121:41–53. CrossRefGoogle Scholar
  6. Dell M, Jones BF, Olken BA (2012) Temperature shocks and economic growth: evidence from the last half century. Am Econ J Macroecon 4:66–95. CrossRefGoogle Scholar
  7. Dell M, Jones BF, Olken BA (2014) What do we learn from the weather? The new climate-economy literature. J Econ Lit 52:740–798. doi: CrossRefGoogle Scholar
  8. Deschênes O, Greenstone M (2011) Climate change, mortality, and adaptation: evidence from annual fluctuations in weather in the US. Am Econ J Appl Econ 3:152–185. CrossRefGoogle Scholar
  9. Dietz S, Stern N (2015) Endogenous growth, convexity of damage and climate risk: how Nordhaus’ framework supports deep cuts in carbon emissions. Econ J 125:574–620. CrossRefGoogle Scholar
  10. Dutton JA (2002) Opportunities and priorities in a new era for weather and climate services. Bull Am Meteorol Soc 83:1303–1311.<1303:OAPIAN>2.3.CO;2 CrossRefGoogle Scholar
  11. Easterling WE, Hurd BH, Smith JB (2004) Coping with global climate change: the role of adaptation in the United States. Occup Med (Lond) 61:1–40. Google Scholar
  12. Eckstein D, Künzel V, Schäfer L (2017) Global climate risk index 2018: Who suffers most from extreme weather events? Weather-related loss events in 2016 and 1997 to 2016. Germanwatch. 
  13. Eskeland GS, Mideksa TK (2010) Electricity demand in a changing climate. Mitig Adapt Strateg Glob Change 15:877–897. CrossRefGoogle Scholar
  14. Gasbarro F, Iraldo F, Daddi T (2017) The drivers of multinational enterprises’ climate change strategies: a quantitative study on climate-related risks and opportunities. J Clean Prod 160:8–26. CrossRefGoogle Scholar
  15. Handmer J, Honda Y, Kundzewicz ZW, et al (2012) Changes in impacts of climate extremes: human systems and ecosystems. In: Managing the risks of extreme events and disasters to advance climate change adaptation: special report of the Intergovernmental Panel on Climate Change, pp 231–290Google Scholar
  16. Hasegawa T, Fujimori S, Matsuoka Y (2009) A study on emission accounting system of global agricultural activities. IOP Conf Ser Earth Environ Sci 32:6–8. Google Scholar
  17. Hsiang SM (2010) Temperatures and cyclones strongly associated with economic production in the Caribbean and Central America. Proc Natl Acad Sci 107:15367–15372. CrossRefGoogle Scholar
  18. IMF (2017) Seeking sustainable growth: short-term recovery, long-term challenges. Washington, DC.Google Scholar
  19. IPCC (2014) Climate change 2014: impacts, adaptation, and vulnerability. Part B: regional aspects. Contribution of Working Group II to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press 688.
  20. Jessoe K, Manning D, Taylor JE (2014) Climate change and labour allocation in rural Mexico: evidence from annual fluctuations in weather. Econ J 128:230–261. CrossRefGoogle Scholar
  21. Lansbergen P, Vice K (2005) The Canadian industry responds to climate change. PPI Pulp Pap Int 47:40Google Scholar
  22. Lee JJ, Gino F, Staats BR (2014) Rainmakers: why bad weather means good productivity. J Appl Psychol 99:504–513. CrossRefGoogle Scholar
  23. Mukheibir P (2013) Potential consequences of projected climate change impacts on hydroelectricity generation. Clim Change 121:67–78. CrossRefGoogle Scholar
  24. Nateghi R, Mukherjee S (2017) A multi-paradigm framework to assess the impacts of climate change on end-use energy demand. PLoS ONE 12:e0188033. CrossRefGoogle Scholar
  25. National Climate Center (2017) China Climate Index Report (2017). 1–19Google Scholar
  26. O’Mahony M, Timmer MP (2009) Output, input and productivity measures at the industry level: the EU KLEMS database. Econ J 119:F374–F403. CrossRefGoogle Scholar
  27. Pinkse J, Gasbarro F (2016) Managing physical impacts of climate change: an attentional perspective on corporate adaptation. Bus Soc. Google Scholar
  28. Sander J, Eichner JF, Faust E, Steuer M (2013) Rising variability in thunderstorm-related U.S. losses as a reflection of changes in large-scale thunderstorm forcing*. Weather Clim Soc 5:317–331. CrossRefGoogle Scholar
  29. Tarawneh QY, Chowdhury S (2018) Trends of climate change in Saudi Arabia: implications on water resources. Climate 6:8. CrossRefGoogle Scholar
  30. Walker JA, Murphy JB (2001) Implementing the North American Industry Classification System at BLS. Mon Labor Rev 124:15Google Scholar
  31. Yang ZB, Fan MT, Shao S, Yang LL (2017) Does carbon intensity constraint policy improve industrial green production performance in China? A quasi-DID analysis. Energy Econ. 68:271–282. CrossRefGoogle Scholar
  32. Zhang X, Cai X (2011) Climate change impacts on global agricultural land availability. Environ Res Lett 6:014014. CrossRefGoogle Scholar

Copyright information

© Springer Nature B.V. 2018

Authors and Affiliations

  1. 1.School of Low Carbon EconomicsHubei University of EconomicsWuhanChina
  2. 2.Center of Hubei Cooperative Innovation for Emissions Trading SystemWuhanChina
  3. 3.Accounting SchoolHubei University of EconomicsWuhanChina
  4. 4.Australia-China Relations InstituteUniversity of Technology SydneySydneyAustralia
  5. 5.Energy Studies InstituteNational University of SingaporeSingaporeSingapore
  6. 6.Center for Social Security StudiesWuhan UniversityWuhanChina
  7. 7.School of Political Science and Public AdministrationWuhan UniversityWuhanChina

Personalised recommendations