EFFECTS OF CLIMATE CHANGE ON ECONOMIC GROWTH: EVIDENCE FROM 20 BIGGEST ECONOMIES OF THE WORLD

This study empirically examines the symmetric and asymmetric effects of climate change measured by temperature and precipitation variables and six other indicators on economic growth in the top 20 economies in the world (WTE-20-in terms of nominal Gross Domestic Product), over the period from 1990 to 2016. Based on the extension of the Cobb-Douglas production function (CDPF), the study uses linear and nonlinear procedures within the scope of new-generation panel data analysis that takes into account the cross-sectional dependence. Regardless of which approaches are used to explain the climate regime, the evidence from this study indicates that climate change has negative and statistically significant effects on economic growth. Therefore, along with the development of climate change adaptation policies, the collaboration under the leadership of the WTE-20 countries to reduce greenhouse gas emissions and thereby prevent the temperature increases should be improved to minimize the negative effects of climate change on growth performances in these countries.