From the UNIVERSITY OF CALIFORNIA – SANTA BARBARA, and the “temperature in Chinese sweatshops may go up a degree” department.
Hot and bothered
Environmental economists studying the impact of climate change on manufacturing in China predict substantial losses by mid-21st century
To date, most empirical evidence on climate change impacts have focused on the agricultural sector. Little is known about the effects on, say, manufacturing in, say, China, which is in many ways “the factory of the world.”
In a new paper published in the Journal of Environmental Economics and Management, UC Santa Barbara researchers shows that climate change will dramatically lower output for the Chinese manufacturing sector.
Using detailed production data from a half-million Chinese manufacturing plants in the period 1998-2007, the research team estimated the effects of temperature on firm-level productivity, factor inputs and output. They predict that by the middle of the 21st century, if no additional adaptations occur, climate change will reduce Chinese manufacturing output annually by 12 percent — equivalent to a loss of nearly $40 billion in 2007 dollars.
With the Chinese manufacturing sector producing 32 percent of national gross domestic product (GDP), this effect is equivalent to a 4 percent drop in overall Chinese GDP annually. Further, given that China’s manufacturing sector supplies 12 percent of global imports, the worldwide economic consequences may be substantial.
“Previous work has largely focused on how climate change may affect economic activity by lowering the productivity of workers,” said co-author Kyle Meng, an assistant professor of environmental economics in UCSB’s Bren School of Environmental Science & Management and the Department of Economics. “It is well documented that when it’s hot, people work less productively.”
The new paper, written with Olivier Deschenes, a professor of economics at UCSB, Peng Zhang of the Hong Kong Polytechnic University (and a former Ph.D. student at UCSB) and Junjie Zhang of Duke Kunshan University in China, points to the effects of temperature on the productivity of capital as well. That is, increasing temperatures not only make workers less productive, they also make machines operate less well.
“In one particularly striking result, we separately examine temperature sensitivity between low- and high-tech industries in China,” Deschenes said. High-tech industries include those that produce medical supplies, aerospace equipment and computer equipment. “We typically think of these sectors as being capital intensive with indoor production facilities that tend to operate with air conditioning,” Deschenes continued. “We find that these industries are just as sensitive to extreme temperature as low-tech industries.”
According to Meng, the results suggest that if we are to reduce climate losses on manufacturing output, adaptation measures should not focus solely on reducing the sensitivity of workers to extreme heat, but also that of factory machines.
“More broadly, our paper introduces a new cost of climate change that hasn’t been documented before,” he said. “China is already doing a lot to reduce its emissions. These existing policies were put into place even without this new evidence on manufacturing sector losses. Given the importance of manufacturing for China, we hope our findings will help lead to more stringent Chinese climate policy.”
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The paper: https://www.sciencedirect.com/science/article/pii/S0095069617304588
Temperature effects on productivity and factor reallocation: Evidence from a half million chinese manufacturing plants
Abstract
This paper uses detailed production data from a half million Chinese manufacturing plants over 1998–2007 to estimate the effects of temperature on firm-level total factor productivity (TFP), factor inputs, and output. We detect an inverted U-shaped relationship between temperature and TFP and show that it primarily drives the temperature-output effect. Both labor- and capital- intensive firms exhibit sensitivity to high temperatures. By mid 21st century, if no additional adaptation were to occur, we project that climate change will reduce Chinese manufacturing output annually by 12%, equivalent to a loss of $39.5 billion in 2007 dollars. This implies substantial local and global economic consequences as the Chinese manufacturing sector produces 32% of national GDP and supplies 12% of global exports.
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What was the toll again in the Cultural Revolution in that orgy of bad ideas forced on the masses?
I thought it was hot and humid in the US southeast, then we moved to China near Hong Kong.
China like the US is a large country with a wide range of climates. From my experience working in power plants, extreme temperatures does affect productivey. However, this has nothing to do with small changes that might be the result of AGW.
At nuke plants, we try to scedule maintenace during the spring and fall when demand for power is lower. There are also warning/cooling sheds to provide for OSHA safety requiremnts.
China has discovered A/C big time. Everyplace indoors we went was had A/C. I read a study by an American university where reseachers were agast at how fast A/C had pentrated on a family level. We had two units in our apartment, one for the bedroom and one for the living room.
Clearly as people become more affleunt they want a nicer apartment. Then they want A/C.
Worldwide demand for power and therefor coal is going to increase.
My suggestion is that concerned college professors and students give up A/C. How about some leadership!
“reseachers were agast at how fast A/C had pentrated on a family level.”
Why would they be ‘aghast’?
Dc Cowboy,
Seriously?
The same reason they want us to eat bugs instead of meat: They are insane control freaks who want everyone else to suffer, so they can be rich and live high on the hog while controlling what everyone else does, down to the last detail.
https://wattsupwiththat.com/2016/07/24/john-kerry-air-conditioners-as-big-a-threat-as-isis/
Someone like Al Gore or Leo Di Caprio almost surely cause more CO2 emissions per week with their multiple huge homes and private jets taking them all over the world and all the time, than an average person will cause to be emitted in their entire life.
And yet they stand on a soap box and pretend they are saving the world by telling other people what they need to do.
At one level, these can be seen to be extremely evil and destructive people.
How about Steelworks or Mines as workers here will experience extremes of temperatures? In fact conditions or equipment may have improved since the 1800s because of better clothing, ventilation and working hours etc. The outside weather is not going to make much difference here. Maybe these academics should see the film of Leningrad factory workers trying to manufacture in sub zero temperatures during the siege of Leningrad. No food and no heat and they still managed to work. Maybe the Chinese should get air conditioning that works? And why the Chinese?
Said the beachcomber in Santa Barbara.
Table 1. Summary statistics. Shows max temperature for 1998–2007 to be 80.57 deg F and predicted max temperature for 2040–2059 to be 81.99 deg F. However, Fig. 1 shows several days of 90+ deg F and a lot of days at 80-90 deg F. This does not match, so the authors cannot even tell a consistent story.
Much of the loss of productivity is supposed to occur on the 90+ deg F days, which Table 1 indicates do not exist.
Its not China, but close. Here are temperatures for Japan since 1998
There was a very small step change (most of Asia got it too iirc) between 1990 and 1998
But before that, during the height of Japanese industrial growth.. we have this
anomalies, not temperatures
data from
http://www.data.jma.go.jp/cpdinfo/temp/list/mon_jpn.html
increasing temperatures… make machines operate less well.
Cold certainly makes machines operate less well
Tank and vehicle lubricants froze as temperatures plunged to record lows.
http://www.iwm.org.uk/history/operation-barbarossa-and-germanys-failure-in-the-soviet-union
The machines work well in hot climates like North Africa.
Environmental economists? Did they remember to consult with the Flat Earth Geometrists and Theological Physicists?
I think these pseudoscientists are a lot of trust-funders that have never been near anyone or anything associated with manufacturing. Productivity follows demand, not the temperature. If a daily quota isn’t met because of a heat wave, management doesn’t simply throw their arms up and say “oh golly it’s too hot to meet our demands, I guess the buyer will just have to take less of our product.”
Climate change will force local production, thereby reducing climate change, thus Catastrophic Anthropogenic Climate Change. Heads you lose. Tails you lose.
If the causation implied by this study were correct, you would already be able to demonstrate differential productivity between manufacturing operations based on geography. That is, plants in the north would be demonstrably more productive than identical plants in the south. Matching the hypothesized effects of future climate change over the period they assessed means about the same as moving a plant 200 miles to the south. In other words, about the difference between Cleveland and Cincinnati or Delaware and North Carolina or Beijing and Jinan.
Funny that there are exactly zero studies showing any such correlation between productivity and latitude today.
OMG!, “Sweat shops” is a derogatory anachronism for lowly paid, crowed garment makers and the clones think it’s going to get sweatier! I can see Steve MacIntyre’s admonition that climate scientists on the Team would likely be highschool science teachers in an earlier generation IF THEY WERE LUCKY. Sweat shops! Gorr.
It also is a racist term. Presumably Africans living in a warmer climate will never be productive by the lights of the climateers.
Agreed everything about the study is built on racism.
Wind and power are a great solutions for manufacturing. The $100+ that BHP lost in the south Australian blackouts are a great advertisement how to encouraging these solutions are for manufacturing. China will be no different . If you make your industry more expensive and unreliable businesses will go elsewhere. The cost of a few more air conditioners is relatively cheap.
As if China didn’t have at least as much natural climate variations already, from Hainan to whatever they now call Manchuria. Most of northeast China has pretty pronounced seasonal temperature variations, but at one time that area was the industrialized part.
More recently, the Chinese have done the same as the US, move south and use AC much of the year.
Most of China has very hot and muggy summers, rather like the US as a matter of fact. July in Hongkong is hotter than in New Orleans, and in Beijing is nearly as warm as in Charleston. But northern China also has quite cold, windy and dusty winters. January in Beijing is colder than in Chicago and in Harbin in Manchuria is almost as cold as in Fairbanks.
These days, the Chinese are growing taller, bigger and more healthy. I am sure that there will soon be a study telling us that Climate Change / Global Warming is to blame for this development too. Perhaps Griff will let us have a reference soon.
It is only to be expected. The same thing happened in Japan a few decades ago when you started noticing that the teenage kids were suddenly much taller than their parents. One wonders how tall they will finally become, since northern chinese are fairly tall even now.
And its all the fault of the CO2 enhanced atmosphere.
Amazing what a bit of food will do 🙂
I noticed that sort of thing when I was a kid. My father’s favorite oriental restaurant was across the street from a Japanese Buddhist Temple, and the families entering the church were like a stairway, with the grandparents being tiny, the parents being about six inches taller, and the adolescent children being three or four inches taller than their parents.
The Chinese word for Japanese means “dwarf”. Insular dwarfism?
There is a big difference between average height in north and south China. Most Chinese Americans are Cantonese.
People are still getting larger and taller all over the world, and I see it with every generation here in the US.
It was less dramatic in places where proper nutrition has been the norm for longer.
The reasons are nutrition and good health in childhood, better prenatal care and nutrition, and epigenetics.
“The Chinese word for Japanese means “dwarf”. Insular dwarfism?”
I can’t vouch for the truth of this, since I don’t speak Chinese, but a chinese acquaintance claims that the correct translation is actually “dwarfed swarthy pirate”.
Maybe that’s the favored address for encounters on the high seas. The Japanese were famed as pirates. And if you’re at sea for long periods in subtropical to tropical latitudes, one would tend toward swarthiness.
The adjective “Japanese” consists of two traditional characters (日本), which literally translated mean “Sun This”, clearly referring to the direction in which the sun rises. But the noun, ie “a person from Japan”, can be just the lone character for “dwarf” (侏), or, inoffensively, the adjective with the character for “people” added (日本人).
No wonder that Japan prefers “Land of the Rising Sun” to “Dwarfland”.
Or, maybe if it weren’t obvious from context, one could clarify by saying, “You know, the dwarfs who are swarthy pirates, not normal, Chinese or inner or outer barbarian dwarfs”.
In this context, the Chinese character for “this” (本) connotes “origin” or “source”, ie “whence comes the sun”.
And the science fiction continues to spew from academics. There will be a time, not long from now, when the word ‘academic’ will be an insult.
The Chinese love A/C. Apartments in China normally don’t come with A/C, but virtually everybody installs one. Which can look rather odd in large housing projects since there seems to be an almost infinite number of different models. They are probably smart enough to realize that they will work in a factory as well.
http://s.newsweek.com/sites/www.newsweek.com/files/styles/lg/public/2017/03/17/rtsefte.jpg
All powered by wind and solar… of course 😉
“They predict that by the middle of the 21st century, if no additional adaptations occur, climate change will reduce Chinese manufacturing output annually by 12 percent “
Surely they don’t mean annually; that would reduce production by 72% in 10 years.
Who cares it’s a stupid fourth rate study. As any business owner knows if your production started to drop away by 12% because of a single issue you would react.
It is like having a study that says production will drop 12% at a business because of a change to doorway. What business is going to let production drop by 12% and not just knock the doorway out.
if the correlation is a genuine causation ( factor) and if china do nothing ..this is true…
well.. you ve notice that most of the timer only the heads of people taking a bath at sea is above the sea level. I noticed too a correlation, the more your heaed is deep in the water the more you are likey to drown. So..according to the models i can etimate that a lot of people are going to drown in the future due to seas level rise. And it is frightenting.
I want to see the correlating study–what happens to these machines when the temperature drops because we’ve “solved” global warming and are now in an ice age? Cuz that is the ultimate goal right? To save the ice! Because we all know that cold doesn’t kill people or machines right?
Or I want to see the headline: Chinese sweat shops become even more sweaty!
Has anyone seriously asked these alarmists what IS the perfect temperature for the Earth they are trying to achieve? As if the Earth has a thermostat they can set! < — see what I did there?
Either way…why don't they concentrate on saving trees instead of publishing this fish wrap? (total tongue in cheek, paper mills plant more trees than they cut down around here–caveat, not everywhere)