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How Climate Change Hurts Our Economy

by Brian Nordli
September 7, 2017 | Our Future

If greenhouse gas emissions remain the same, the U.S. could be facing steep economic losses and more inequality within the next generation. It’s University of Chicago economist Amir Jina's goal to make sure that doesn’t happen.

University of Chicago economist Amir Jina stands in his office on the university campus in August 2017. Jina is a fellow with the Energy Policy Institute at the University of Chicago. Photo by Brian Nordli.

Jina and a team of economists and climate scientists took a granular look at U.S. counties to estimate the financial cost of climate change in a new study published in Science magazine. The results surprised him.

They discovered that the U.S. will face a 1.2 percent drop in gross domestic product, the value of goods produced and services rendered in the country, for every 1 degree Celsius (that's 1.8 degrees Fahrenheit) increase in temperature. But it’s the poorest-third of counties—primarily in the South and lower Midwest—that will bear the brunt of the financial strain.

Jina hopes an economics-centric look at climate change will resonate with people and spur policymakers to take measures to mitigate climate change. If nothing else, it makes good business sense.

Calculating the dollars and cents of climate

How did the researchers distill the cost of climate change into such a tangible equation? The study combined climate change data with cost-benefit analysis to help project the cost of increasing temperatures, rising sea levels and storm frequency on counties across the U.S. over the next 100 years. The researchers focused on nine economic sectors, including agriculture, mortality rates, labor rates and county income.

Climate Change pbs rewire

They found that states like Texas, Alabama, Louisiana and Florida—which are closer to the rising coast or already hot—will suffer higher mortality rates, losses of up to 20 percent of county income and a shrinking labor force as temperatures rise.

Rewire spoke with Jina about the study’s findings, the impact of Hurricane Harvey in Texas and enacting change when it comes to environmental policy:

Rewire: You’ve spent time traveling to other countries like India and Bangladesh to observe the impacts of climate change elsewhere. What did you see in your research of the U.S.?

Amir Jina: I took back (from those trips) the motivation to understand climate impact and apply that to the U.S. While the impact looks like it’s smaller in magnitude, it’s still on the magnitude of things we care about and make policies for. We found that the total predictive mortality from increasing temperatures would add additional deaths similar to the number of road deaths there are in the U.S. today.

We have so many policies to protect people on the road, but we don’t have that many policies about climate change. We don’t think about it in the same way, but it’s not too different. We have a probability of something happening, and it’s possible to make policies for those types of things.

Rewire: Put your findings into perspective for us. What would drop in about 1.2 percent of GDP for every 1 degree Celsius look like in the U.S.?

AJ: What stood out as we looked at the data on a map is that there’s this big inequality of where the impacts were happening between the North and the South (in the U.S.). We saw that states that are poorer on average per capita are going to suffer more of the impacts. It’s something we talk about in this field, saying that poorer countries are going to be hit harder, but to see that in the U.S. was stunning.

Rewire: What's the relation between hurricanes Harvey, Irma, Jose and Katia and climate change? 

AJ: It’s difficult to attribute a single event to climate change. What you can say is that with something like this happening, climate change has made it worse. The fact that this is happening in Houston — it’s sadly inevitable. These are some of the worst places to be hit, and then one of them gets hit very badly.


This is the challenge happening now, and it is going to be a more frequent occurrence. We don’t want this to happen in the first place. Policy can address that, but we also need to understand where is the most vulnerable, what is the most vulnerable in different sectors and how they will adapt. This event really throws into stark relief what’s at stake.

Rewire: What has been the reaction to your research?

AJ: The paper has come at a time when people needed to be reminded that this is a big issue. There’s an attack on science and the type of science we do. It’s a good time to remind people that this is important. There is human cost to these things, and ignoring information is a very dangerous thing to do.

Climate Change pbs rewire

The encouraging sign is that you have state governments like California saying this is an existential threat to our future, or less dramatically, that this makes good sense for our economy, and we want to make policies on this.

Rewire: Do you feel like there is a ticking clock in your head when it comes to acting on climate change?

AJ: It can lead to a sense of anxiety, but a lot of us feel the alarmism of the past—that the world is ending—is not really productive. By telling people that there’s no hope for anything, you make them believe there’s no hope for anything. It distracts from the fact that there are actions we can take continuously, and we should be talking about them.

I don’t want to give in to that ticking clock that says it’s too late to do anything. The truth is, let’s act now. If progress doesn’t happen as much as possible, then let’s keep working towards progress.

Brian Nordli
Brian Nordli is a freelance journalist based in Chicago, where he writes about social issues, immigration and culture. Before returning to his hometown, he worked at a newspaper in Las Vegas covering crime, education and the city’s desert denizens. He recently spent more than a year teaching English in South Korea and traveling Europe and Asia. He hasn't been able to shake his craving for kimchi since.
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