Extremes in rainfall — whether intense drought or flash floods — can catastrophically slow the global economy, researchers report in the Jan. 13 Nature. And those impacts are most felt by wealthy, industrialized nations, the researchers found.
A global analysis showed that episodes of intense drought led to the biggest shocks to economic productivity. But days with intense deluges — such as occurred in July 2021 in Europe — also produced strong shocks to the economic system (SN: 8/23/21). Most surprising, though, was that agricultural economies appeared to be relatively resilient against these types of shocks, says Maximilian Katz, an environmental economist at the Potsdam Institute for Climate Impact Research in Germany. Instead, two other business sectors — manufacturing and services — were the most hard-hit.
As a result, the nations most affected by rainfall extremes weren’t those that tended to be poorer, with agriculture-dependent societies, but the wealthiest nations, whose economies are tied more heavily to manufacturing and services, such as banking, health care and entertainment.
It’s well established that rising temperatures can take a toll on economic productivity, for example by contributing to days lost at work or doctors’ visits (SN: 11/28/18). Extreme heat also has clear impacts on human behavior (SN: 8/18/21). But what effect climate change–caused shifts in rainfall might have on the global economy hasn’t been so straightforward. That’s in part because previous studies looking at a possible connection between rainfall and productivity have focused on changes in yearly precipitation, a timeframe that “is just too coarse to really describe what’s actually happening [in] the economy,” Katz says. Such studies showed that more rain in a given year was basically beneficial, which makes sense in that having more water available is good for agriculture and other human activities, he adds. “But these findings were mainly focused on agriculturally dependent economies and poorer economies.”
In the new study, Katz and his colleagues looked at three timescales — annual, monthly and daily rainfall — and examined what happened to economic output for time periods in which the rainfall deviated from average historical values. In particular, Katz says, they introduced two new measures not considered in previous studies: the amount of rainy days that a region gets in a year and extreme daily rainfall. The team then examined these factors across 1,554 regions around the world — which included many subregions within 77 countries — from 1979 to 2019.
The disparity over which regions are hit hardest is “at odds with the conventional wisdom” — and with some previous studies — that agriculture is vulnerable to extreme rainfall, writes, an atmospheric scientist at the University of Maryland in College Park, in a commentary in the same issue of Nature. Researchers may need to incorporate other factors in future assessments, such as growth stages of crops, land drainage or irrigation, in order to really understand how these extremes affect agriculture, writes. Including daily and monthly rainfall extremes in this type of analysis was “an important innovation” because it revealed new economic vulnerabilities, says Tampa Carleton, an environmental economist at the University of California, Santa Barbara, who was not involved in the new work.
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