The Economic and Societal Impact of Climate Change

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Recently, I wrote about the state of our climate and outlined our understanding of the science.  Now, let’s talk about the economic impact of these changes, some of which the U.S. Government Accountability Office has summarized in this map reflecting the end of the century.

Urban areas

We can explore some of these implications.  In our own work, for example, we are trying to understand the impacts of climate change on urban areas.  This includes estimating increases in energy use for air conditioning.  We also quantify how choices made by city planners can reduce the length and magnitude of increased heat waves in urban centers due to a warming climate by requiring green roofs on buildings.

Earlier this month, I attended a conference hosted by Columbia University focused on the risks of a changing climate on property values, insurance and infrastructure in coastal regions.  Among other views, many speakers noted the shift of absorbing risk away from governments, including the US, to the private sector.  Enabling such a transformation requires improved science working together with businesses.  Among the examples include investment analysts evaluating the climate resiliency plans by local government to assess their local term credit ratings.


In aviation, recent work points to the potential for increased clear-air turbulence due to climate change.  Given how the southwestern portion of the United States was baked during periods of last summer, the concern about a warmer climate’s impact on routine commercial aviation has been resurrected.


To be viable and to grow, our economy and society relies on the availability of electricity;  climate change will impact our electricity infrastructure.  Some thermal plants will no longer be viable because of the lack of water at a sufficiently low temperature for cooling and/or steam generation.   Hydro-electric plants will lose capacity because of droughts.  Wind and solar power potential will change.  For example, there will be a reduction in wind power potential of 10 percent by 2050 and 18 percent by 2100 in the central US (and an increase of 21 percent by 2050 and 42 percent by 2100 in eastern Brazil).


There are other aspects related to the earth’s changing climate that have a more direct and significant societal and economic impact.  These, along with impacts of damaging storms or drought that can affect availability of food or water, can lead to societies becoming unstable.  Events in Syria have suggested the potential for such concerns in the future.

Researchers have long examined the relationship between disease and our changing climate.  For example, there are up to one hundred thousand new cases of diabetes in the US for each 1°C increase in temperature. In combination with air pollution, there is an expectation of increased incidences of asthma and other respiratory diseases.

A recent study considered the limits of human exposure under conditions of high heat and humidity, which would impact outdoor activity.  The authors estimated that one million person-days would be lost per year by 2080, especially in the Middle East, India, and parts of Africa and South America.


A group of interdisciplinary researchers recently examined how a warming climate can affect multiple commercial sectors.  When combined with a number of societal impacts, this can lead to a reduction in economic output, at least 1-3 percent in the US alone (~0.7 percent per 1°C increase in warming).  Their study  also showed the relative inequality of this impact, where many of the poorer counties in the US would more likely experience more adverse effects (~10 to 20 percent of GDP), which is illustrated in the map below.

What can you do to help?

While previously I talked about we can do to become better informed, we can also lead by example in our home and work lives, recycling as well as reducing our use of energy and water, to decrease the effects of climate change.  For example, over the last two years, I installed solar panels on the back roof of my house and replaced an aging and inefficient air conditioning system with high-efficiency heat pumps.  This relegated my oil furnace for use only during very cold days.  I also replaced an old propane-fired clothes dryer with a high-efficiency electric model.  These personal investments significantly reduced my family’s energy consumption and our carbon footprint.

IBM Distinguished Engineer

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