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The distributional impact of climate change on rich and poor countries

Published online by Cambridge University Press:  22 March 2006

Yale School of Forestry and Environmental Studies, 230 Prospect Street, New Haven CT 06511
World Bank, 1818 H Street NW, Washington DC 20433
Electric Power Research Institute, 3412 Hillview Ave, Palo Alto, CA 94303


This paper examines the impact of climate change on rich and poor countries across the world. We measure two indices of the relative impact of climate across countries, impact per capita, and impact per GDP. These measures sum market impacts across the climate-sensitive economic sectors of each country. Both indices reveal that climate change will have serious distributional impact across countries, grouped by income per capita. We predict that poor countries will suffer the bulk of the damages from climate change. Although adaptation, wealth, and technology may influence distributional consequences across countries, we argue that the primary reason that poor countries are so vulnerable is their location. Countries in the low latitudes start with very high temperatures. Further warming pushes these countries ever further away from optimal temperatures for climate-sensitive economic sectors.

Research Article
© 2006 Cambridge University Press

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We want to thank the reviewers and editor for their very helpful comments. The views in this paper are those of the authors and should not be attributed to the World Bank.