Warming and GDP Growth in the United States : A Heterogeneous, Common Factor Dynamic Panel Analysis

This paper analyzes whether temperature changes influence economic growth in the contiguous 48 US states by employing panel methods that address both heterogeneity and cross-sectional dependence. Ultimately, it is determined that the negative effect of warming (proxied by cooling degree days) is restricted to agriculture GDP and found in only a few (mostly northern and more agriculturally dependent) states. But when weathers' impact was measured by average summer temperature, the negative effect — still restricted to agriculture GDP — was substantially and significantly larger (a finding similar to previous work) and more geographically uniform