Material Properties
Is Less Really More? Comparing the Climate and Productivity Impacts of a Shrinking Population
Mark Budolfson et al.
NBER Working Paper, June 2025
Abstract:
A smaller human population would emit less carbon, other things equal, but how large is the effect? Here we test the widely-shared view that an important benefit of the ongoing, global decline in fertility will be reductions in long-run temperatures. We contrast a baseline of global depopulation (the most likely future) with a counterfactual in which the world population continues to grow for two more centuries. Although the two population paths differ by billions of people in 2200, we find that the implied temperatures would differ by less than one tenth of a degree C -- far too small to impact climate goals. Timing drives the result. Depopulation is coming within the 21st century, but not for decades. Fertility shifts take generations to meaningfully change population size, by which time per capita emissions are projected to have significantly declined, even under pessimistic policy assumptions. Meanwhile, a smaller population slows the non-rival innovation that powers improvements in long-run productivity and living standards, an effect we estimate to be quantitatively important. Once the possibility of large-scale net-negative emissions is accounted for, even the sign of the population-temperature link becomes ambiguous. Humans cause greenhouse gas emissions, but human depopulation, starting in a few decades, will not meet today’s climate challenges.
Leveraging the Disagreement on Climate Change: Theory and Evidence
Laura Bakkensen, Toan Phan & Tsz-Nga Wong
Journal of Political Economy, forthcoming
Abstract:
We develop a credit-search model with maturity choice where agents disagree on when a long-run disaster will damage collateral assets. It predicts that disaster-pessimistic agents are more likely to leverage risky-asset purchases, and prefer debt contracts with longer maturities. Intuitively, pessimists value the default option of debt contracts as implicit disaster insurance, whose coverage increases with maturity implicitly and costs less to optimistic lenders. Using high-resolution sea-level-rise projections and comprehensive propriety data on coastal real estate and mortgages, we find robust evidence of these predictions. The findings provide relevant policy implications on insurance mandates, securitization, disaster assistance, and financial stability.
Not In My Backyard: Intrinsic Motivation And Corporate Pollution Abatement
Angie Andrikogiannopoulou, Alexia Ventouri & Scott Yonker
Review of Finance, July 2025, Pages 1067-1104
Abstract:
We investigate whether managers’ intrinsic incentives affect firms’ environmental policies. Exploiting within-facility variation in facility-to-CEO-birthplace distances, we find that facilities located near CEOs’ birthplaces experience toxic emission reductions relative to those farther away. This is achieved by reducing waste generation at source rather than by downsizing operations or substituting pollution across locations. The effect is strongest for hometown facilities in high-polluting areas, and in firms with higher cash holdings and with CEOs with weaker pay incentives. Our results suggest that local representation in management could be a powerful means of encouraging corporate pollution abatement.
Impact of large-scale solar on property values in the United States: Diverse effects and causal mechanisms
Chenyang Hu et al.
Proceedings of the National Academy of Sciences, 17 June 2025
Abstract:
As the renewable energy transition continues into less receptive communities, local opposition is expected to intensify, potentially slowing the process. Since the local impacts are neither well quantified nor widely recognized, we lack policies and common practices to mitigate the potential associated welfare loss in affected communities. Based on a nationwide dataset combining property transactions and large-scale solar photovoltaic (LSSPV) sites, we analyze the heterogeneous effects of LSSPV on property prices and the associated causal pathways. Difference-in-differences estimates show that LSSPV significantly increases agricultural or vacant land value by about 19.4% within a 2-mile radius, while simultaneously reducing residential property values within 3 miles by about 4.8%. The estimated average negative impact on home values is primarily driven by site proximity and diminishes with both distance and time. Effect estimates are more robust to alternative specifications when proximity pairs with visibility rather than invisibility, but no evidence suggests visibility significantly amplifies the proximity effect. Heterogeneous effect estimates indicate that high solar lease potential, being in heavily Democratic-leaning counties, and brownfield redevelopment largely mitigate the negative residential value impact. The analysis reveals no significant heterogeneity across a few factors, including varying site visibility, directional orientation of properties relative to the LSSPV site, and different tracking systems. Evidence indicates that the negative impact on residential values might mainly stem from negative perceptions, but channels through physical conditions cannot be entirely dismissed. Our assessment provides benchmark information for local externality mitigation plans, potentially reducing community opposition and expediting the renewable energy transition.
Destructive Behaviour, Judgement, and Economic Decision-making under Thermal Stress
Ingvild Almås et al.
Economic Journal, forthcoming
Abstract:
Accumulating evidence indicates that environmental temperature substantially affects economic outcomes and violence, but the reasons for this linkage are only partially understood. We study whether temperature directly influences behaviour by evaluating the effect of thermal stress on multiple dimensions of economic decision-making, judgement, and destructive behaviour with 2,000 participants in Kenya and the US who were randomly assigned to different temperatures in a laboratory. The main finding is that most major dimensions of economic decision-making are unaffected by temperature. We also find that heat significantly increases willingness to voluntarily destroy other participants’ assets in the Kenyan sample.
Biological Mechanisms for Allen's Rule: DNA Methylation as Mediator of the Association Between In Utero Exposure to Environmental Heat and Tibial Growth in Childhood
Bilinda Straight et al.
American Journal of Human Biology, July 2025
Objectives: Understanding human phenotypic plasticity in response to social, ecosystem, and climate interactions can be an important tool for designing social and public health strategies that increase climate change resilience. Sensitivity of the tibia to environmental perturbations is well established; moreover, Allen's rule predicts relatively longer tibial length in hotter climates. In this study, we hypothesized DNA methylation (DNAm) changes as potential mechanisms for impacts of environmental heat exposure in utero persisting in childhood tibial growth in Kenyan Samburu pastoralist children ages 1.8–9.6 years living in a global climate change vulnerability hotspot.
Methods: DNAm data was measured from whole saliva using the Infinium MethylationEPIC BeadChip array. To test our hypothesis, we tested for differential DNAm and we performed high-dimensional mediation analysis using high-resolution (0.05 × 0.05) land surface temperature variables (LST) for each trimester of gestation and compared this to models using a coarser method (contrasting climate zones).
Results: We found differentially methylated CpG sites in both LST and comparison models, near genes relevant to linear growth, with some overlap between models, as expected. We identified 37 CpG sites mediating the association between LST > 37°C exposure in utero and tibial growth into childhood, and 13 CpG sites as mediators in comparison models.
Amazon rainforest adjusts to long-term experimental drought
Pablo Sanchez-Martinez et al.
Nature Ecology & Evolution, June 2025, Pages 970-979
Abstract:
Drought-induced mortality is expected to cause substantial biomass loss in the Amazon basin. However, rainforest responses to prolonged drought are largely unknown. Here, we demonstrate that an Amazonian rainforest plot subjected to more than two decades of large-scale experimental drought reached eco-hydrological stability. After elevated tree mortality during the first 15 years, ecosystem-level structural changes resulted in the remaining trees no longer experiencing drought stress. The loss of the largest trees led to increasing water availability for the remaining trees, stabilizing biomass in the last 7 years of the experiment. Hydraulic variables linked to physiological stress, such as leaf water potential, sap flow and tissue water content, converged to the values observed in a corresponding non-droughted control forest, indicating hydraulic homeostasis. While it prevented drought-induced collapse, eco-hydrological stabilization resulted in a forest with reduced biomass and carbon accumulation in wood. These findings show how tropical rainforests may be resilient to persistent soil drought.
Greener green and bluer blue: Ocean poleward greening over the past two decades
Haipeng Zhao et al.
Science, 19 June 2025, Pages 1337-1340
Abstract:
Although the global greening associated with climate change is well documented on land, similar trends in the ocean have not been thoroughly identified. Using satellite observations of ocean chlorophyll a (Chl) concentration, we show that the surface ocean experienced a poleward greening from 2003 to 2022. Contemporaneously, the subtropical regions of the Northern Hemisphere experienced a decrease in Chl. As such, the latitudinal disparity in Chl, as documented by an inequality index, has been increasing over the past two decades, particularly in the Northern Hemisphere. Rising water temperatures may primarily influence the Chl trends. The increasing Chl inequality -- marked by “greener green and bluer blue” waters -- has the potential to cascade to higher trophic levels, with implications for the fisheries and economies of coastal nations.
Human influence on climate detectable in the late 19th century
Benjamin Santer et al.
Proceedings of the National Academy of Sciences, 24 June 2025
Abstract:
The physics of the heat-trapping properties of CO2 were established in the mid-19th century, as fossil fuel burning rapidly increased atmospheric CO2 levels. To date, however, research has not probed when climate change could have been detected if scientists in the 19th century had the current models and observing network. We consider this question in a thought experiment with state-of-the-art climate models. We assume that the capability to make accurate measurements of atmospheric temperature changes existed in 1860, and then apply a standard “fingerprint” method to determine the time at which a human-caused climate change signal was first detectable. Pronounced cooling of the mid- to upper stratosphere, mainly driven by anthropogenic increases in carbon dioxide, would have been identifiable with high confidence by approximately 1885, before the advent of gas-powered cars. These results arise from the favorable signal-to-noise characteristics of the mid- to upper stratosphere, where the signal of human-caused cooling is large and the pattern of this cooling differs markedly from patterns of intrinsic variability. Even if our monitoring capability in 1860 had not been global, and high-quality stratospheric temperature measurements existed for Northern Hemisphere mid-latitudes only, it still would have been feasible to detect human-caused stratospheric cooling by 1894, only 34 y after the assumed start of climate monitoring. Our study provides strong evidence that a discernible human influence on atmospheric temperature has likely existed for over 130 y.