Financial stability in response to climate change in a northern temperate economy

This research investigates the economic impacts of climate change in Canada, focusing on the influence of various climate variables beyond average temperature and considering sub-annual economic cycles. A flexible, non-linear framework is developed to estimate GDP changes and project adjustments in economic cycles. The study finds that incorporating a broader set of climate variables significantly improves model accuracy, predicting a net increase in GDP unlike models using only temperature. Regional variations are analyzed, with the Prairie and Atlantic regions identified as most vulnerable, while the Southeastern region shows relative resilience. The research provides a method applicable to other economies globally for targeted adaptation and resilience management.

Kayla Stan, Graham A. Watt, Arturo Sanchez-Azofeifa