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Publication Date

2021

First Advisor

Vis Tariz

Second Advisor

Simon Halliday

Document Type

Honors Project

Degree Name

Bachelor of Arts

Department

Economics

Keywords

Developmental economics, South Africa, Labor economics, Environmental economics, Climate change, Economic development, Employment, Labor

Abstract

As anthropogenic climate change accelerates, countries will experience an increased frequency of extreme weather conditions. In this paper, I assess the impact of rising average temperatures, extreme heat days and drought on the employment outcomes of working age individuals in South Africa between 2008 and 2017. South Africa presents a critical setting to study as annual average temperatures have increased by 1.5 times the observed global average of 0.65°C over the past five decades. In addition, extreme weather events such as drought have increased in frequency. Using high-resolution weather data and panel survey data containing individual labor market outcomes, I find that drought in the non-growing season of the crop-calendar year decreases the probability that a prime-age worker is employed in the formal economy by approximately 2 to 3 percentage points. I further analyze the effects of rainfall and temperature shocks on employment outcomes in the agricultural, manufacturing and service sectors, and find that drought in the non-growing season of the crop-calendar year negatively impacts the probability of employment in the agricultural and service sectors respectively. I find that temperature shocks in the growing season decrease the probability of employment in manufacturing, but increase the probability of employment in agriculture. The positive effect of higher temperatures on agricultural employment indicate that agricultural workers may face liquidity constraints that trap or pull them back into the agricultural sector. Overall, my results show that workers in the South African economy are vulnerable to climate change. As South Africa faces significant levels of poverty and inequality, with a staggering unemployment rate of 30.1%, these adverse weather shocks on employment outcomes may have high economic and social welfare costs.

Rights

©2021. Harriet Margaret Brookes Gray.

Language

English

Comments

56 pages : color illustrations Includes bibliographical references (pages 29-31)

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