Macroeconomic effects of weather shocks, 1870 - 1913

Abstract

This paper considers the influence of weather shocks at a disaggregated level of analysis, modelling the effects of weather shocks on British agriculture, construction and energy demand over the period 1870-1913. The impact of weather shocks will vary from sector to sector as the conditions favouring one activity may be adverse to another. The sectoral effects are aggregated to give us an estimate of the macroeconomic effects of weather on business cycle fluctuations.