The Effects of Climate Change on GDP in the 21st Century: Working Paper 2025-02

By Chad Shirley and William Swanson.

This working paper provides an estimate of a probability distribution of changes in gross domestic product (GDP) in the year 2100 resulting from changes in temperature. To estimate that distribution, we perform a meta-analysis of the literature on the effects of climate change on GDP and combine those effects with forecast global temperature distributions for the year 2100. We fit Gaussian distributions to the underlying data and numerically estimate the joint distribution of GDP and temperature. Using that distribution, we project that, on average, future temperature increases will cause GDP to be 4 percent lower in 2100 than it would have been if temperatures remained unchanged after 2024. However, considerable uncertainty surrounds the long-run effects of temperature on output in the United States. There is a 5 percent chance that GDP in 2100 will be at least 21 percent lower than it would have been in the absence of additional changes in temperature. There is a similar chance that GDP will be at least 6 percent higher by 2100.