Title: Growth exposure to climate change risk: ClimaGRisk
Authors: Laura Garcia-Jorcano - Universidad de Castilla-La Mancha (Spain) [presenting]
Juan-Angel Jimenez-Martin - Complutense of Madrid (Spain)
Dolores Robles - Universidad Complutense de Madrid (Spain)
Abstract: Climate change may alter the growth trajectory of a country, for example, by reducing productivity (particularly in agriculture), destroying productive assets (during extreme events), or altering investment priorities (from productive investment toward adaptation). It, therefore, remains a pertinent question of how the growth strategies of developing countries may have to be adjusted to account for climate change. The co-movement between climate risk and growth is explored through a Climate Risk exposure measure, ClimaGRisk, inspired by the financial systemic risk literature. We find evidence of a sign-switching sensitivity at different quantiles, which implies that the uncertainty surrounding climate change risk seems to have an asymmetric impact on the growth conditional distributions.