Climate change and firm performance

Abstract

This thesis explores the impact of climate change on firm performance and examines the possible mechanism by which weather shocks influence sales outcomes. Leveraging a comprehensive dataset spanning Brazilian manufacturing firms between 2003 and 2009, coupled with high-resolution weather data, the study analyzes the impact of weather shocks. Employing the identification strategy of location-specific z-scores with the analytical framework advanced by Colmer (2021), the findings underscore the profound effect of weather shocks causing substantial declines in firm sales. Furthermore, the research investigates the distributional impacts of weather fluctuations. A closer examination reveals that the Northern regions of the country bear the brunt of these adversities, experiencing disproportionately greater sales losses compared to their Southern counterparts. In addition, the study delves into the transmission mechanisms of the weather-firm performance nexus. It finds that frequent power outages and inclines in energy costs as drivers of the declines in sales through productivity shocks.

Date of Award	2 Jul 2024
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Joana Silva (Supervisor)