The Impact Of Extreme Temperature To Labor Income

In recent years,global warming and extreme weather events have been extensive,profound and intense,exerting a profound impact on the operation and development of the economy and society.Assessing the impact of climatic and environmental factors on economic society is essential for designing climate adaptation policies.Among them,the changes in labor income under the extreme temperature reflect the extent to which the economic well-being of workers is affected by climate factors,and whether the economic and social security system effectively responds to climate change.Based on the data of Chinese manufacturing enterprises from 1998 to 2007 and the daily meteorological data at the county level,this paper empirically analyzes the influence of extreme temperature on the labor income and the differential channels.Then,this paper indirectly demonstrates the mechanism once again by analyzing the heterogeneity across different types of firms,and tests the climate adaptability by analyzing the heterogeneity of different climate regions.Finally,this paper also investigates whether the high temperature subsidy in the pilot period can reduce the effect of "temperature-labor income".The results are as follows:(1)There is a stable inverted U-shaped relationship between temperature and labor income.Extreme low temperature and extreme high temperature both reduce labor income.(2)Extremely low and high temperature affect labor income through differential channels.Specifically,the extremely low temperature mainly lower labor income by reducing the average wages from the intensive margin,which is possibly because workers work fewer hours due to snowstorms or hailstorms.While,the high temperature mainly affects wages by decreasing the number of employees from the extensive margin aspect,because of the replacement of capital and machine to labor for the firm under the heat shock.(3)The "temperature-income" effect shows significant differences between different types of firms.The labor income of low-skilled,labor-intensive firms and those with less education is disproportionately affected by extreme temperatures.(4)In addition,the labor income in hot/cold regions is not affected by extreme high/low temperature,indicating the adaptability of individuals and economic society to climate change.(5)Finally,the high temperature subsidy policy in the pilot period has not been able to effectively reduce the negative impact of extreme temperature on labor income.According to the research conclusions,the corresponding policy implications are as follows.First of all,the government should strengthen the design and the implementation of labor protection policies.The standards for high temperature subsidies should be scientifically set,and pilot programs for low-temperature subsidies should be encouraged.Raising human capital for workers should be encouraged.Second,the government should encourage firms to invest in climate-defensive facilities through monetary,fiscal or industrial policies.Finally,the government need to lift the understanding of the impact of climatic factors throughout the whole society,and deepen the actions on climate change mitigation and adaptation.Research on the effectiveness and cost-effectiveness of climate adaptation projects and policies also should be promoted.For firms,it is necessary to give full play to the function of unions,improve the production and rest system under extreme temperatures,actively assume the social responsibility in climatic governance,and build a "climate-production" friendly corporate culture.