Climate change presents poor nations with an unfortunate paradox: Though they missed out on the riches of the fossil fuel era, they appear doomed to suffer the worst of its consequences. Many experts predict climate change will drag down national income, but how and where such effects may be felt has been anyone’s guess until recently. Now research suggests that heat may hinder growth in poor nations while leaving wealthy ones relatively untouched

Click here to continue

High temperatures are sometimes blamed, fairly or not, for the lack of development in many poor nations. But since climate change will almost certainly make them hotter, the issue has taken on new importance. New research by Ben Jones, associate professor of management and strategy at the Kellogg School of Management, Melissa Dell, doctoral student at MIT, and Benjamin Olken, a professor also at MIT, found rising temperatures in the late twentieth century hurt poor countries in myriad, previously unknown ways, affecting everything from income to investment, innovation, and political stability.

But most surprising, according to Jones, was that the warming trend appeared to be "affecting the rate of economic growth as opposed to simply the level of it." He had expected a slump in output, but not the alarming drop in growth. A period of low output can be a temporary handicap, but reduced growth can cause lasting economic damage. For example, a dry year can devastate harvests, but if the drought lifts the following year, harvests can rebound. These drought-year harvests represent lost output, but a recovery means no lasting damage is done. But if during the drought the farmer’s cattle died for lack of water, her future harvests will suffer, too. She may never see the same yields again. "Once you get an effect on growth, you lose your output one year and you don’t get it back," Jones says.