Climate Risk as a Shock Multiplier: The Impact of US Shocks on African Economies

This paper analyzes the impact of US shocks on economic growth and inflation in African countries, given their varying levels of climate risk. The analysis uses a Vector Autoregressive (VAR) model. Rather than studying the direct effects of climate shocks on the economy, the study analyzes the varying shock response given the varying levels of climate risk. If more climate-vulnerable countries exhibit a higher shock response, this would suggest that climate risk is an amplifier of global shocks.., given their varying levels of climate risk. The analysis uses a Vector Autoregressive (VAR) model. Rather than studying the direct effects of climate shocks on the economy., the study analyzes the varying shock response given the varying levels of climate risk. If more climate-vulnerable countries exhibit a higher shock response., this would suggest that climate risk is an amplifier of global shocks.