Plain Language Summary

The escalating climate change poses numerous challenges for the world, encompassing various aspects such as resource scarcity, natural disasters, decreased grain production, as well as increased population displacement. These issues have the potential to reshape the global geopolitical pattern by triggering more international cooperation, competition, or conflict. The study explores the effect of climate change on geopolitical risk in 40 countries from 1994 to 2020, as well as the underlying mechanism. It also verifies the heterogeneous effect of climate change on geopolitical risk in different scenarios. The findings reveal several key conclusions: (1) Rising temperature significantly increases geopolitical risk, with 1% increase in temperature leading to an increase of 2.1% in geopolitical risk. In contrast, the precipitation, dew point, wind speed and sea level pressure do not demonstrate a significant relationship with geopolitical risk. (2) The positive correlation between temperature and geopolitical risk gradually weakens since 2004. (3) Rising temperature has a greater positive effect on geopolitical risk in under-developed countries or in arid regions. (4) The mechanism through which rising temperature affects geopolitical risk includes reductions in manufacturing growth, human development index, and wheat yields. This paper systematically scrutinizes contribution of climate change to geopolitical risk, highlighting the importance of mitigating climate change to reduce global geopolitical risk.

JEL classification: R11; Q54; Q58

Climate Change & Geopolitical Risk

Climate change is a significant driver of social tension and conflict worldwide. It exacerbates tensions by increasing competition for natural resources, with the uneven distribution of global energy resources making it impossible for any country, particularly underdeveloped ones, to ensure energy supply and transition security independently. Previous research has predominantly examined the impact of military factors, migration, and economic development on geopolitical risk, as well as the effects of temperature on migration, food production, economic development, and quality of life. However, there has been limited focus on how unilateral or multilateral cooperation in the global response to climate change reshapes the geopolitical risk landscape. By analyzing data from 40 countries spanning from 1994 to 2020, this paper systematically explores the correlation between climate change and geopolitical risk, expanding on potential mechanisms beyond the energy transition. The primary finding is that rising temperatures significantly increase geopolitical risk for nations. The study also reveals that the impact of rising temperatures on geopolitical risk is more pronounced in less developed countries, and is stronger in arid regions than in temperate regions. Additionally, it confirms that manufacturing growth, wheat yield, and the Human Development Index are mechanisms through which temperature influences geopolitical risk. These conclusions broaden the scope of research in the field of climate change and geopolitical risk, offering valuable insights for policy recommendations amid the current global geopolitical transformation.

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A Spatial Econometric Analysis of the Aerotropolis Atlanta

Effect of Climate Change on Geopolitical Risk: From 1994 to 2020