Equitable Growth in Conversation is a recurring series where we talk with economists and other academics to help us better understand whether and how economic inequality affects economic growth and stability. In this installment, Michael Garvey, a macroeconomic policy analyst at the Washington Center for Equitable Growth, speaks with R. Jisung Park, an assistant professor of public policy at the University of California, Los Angeles. His research interests center on how environmental factors shape economic opportunity, mobility, and well-being, including the effects of climate on social inequality. Park also concurrently is a visiting scholar at Equitable Growth, where he helps expand the organization’s institutional research capacity and policy knowledge in the environmental economics space. In 2020, he received an Equitable Growth grant to explore the effects of climate change on workplace safety and inequality.

In a recent conversation, Garvey and Park discussed:

• Park’s foray into environmental economics
• Park’s research agenda and contributions to environmental economics
• The role of big data in environmental economics research
• Policy actions to address the consequences of climate change
• Future areas for research on climate, inequality, and economic growth
• Park’s work and focus as a visiting scholar at Equitable Growth

Michael Garvey: Thank you so much for taking the time to join me today. I’m excited that we can feature you in our In Conversation series, especially since your research focuses on such a pressing topic—the effects of climate change on inequality. I’m very excited to dive into your work.

R. Jisung Park: Thank you, and I’m excited for this conversation.

Garvey: My first question is about your research to date, which primarily focuses on the intersection of labor market frictions and the adaption of climate change. What was it that sparked your interest in such a hot topic?

Park: Pun intended, right?

Garvey: Exactly.

Park: So, to start at the beginning, I actually thought I wanted to be a field ecologist. I didn’t really know that I had an interest in economics until after I got to college, though my curiosity about the subject was planted during an influential class in high school. My first major interest in life was the destruction of the tropical rainforest and the decline of biodiversity, which led me to do a gap year between high school and college in the rainforest. That experience among ecologists taught me that I actually didn’t want to be a field biologist, and, indeed, that I was more interested in the economic systems that were giving rise to what, at the time, I couldn’t articulate as a market failure, but which was a market failure in terms of deforestation.

A series of chance encounters then led me to discover environmental economics. It really wasn’t until I was getting my Ph.D. in economics at Harvard University, interacting with the greats, such as Raj Chetty and Larry Katz—that I began to see how, if you combine careful economic analysis with these broader methodological trends in causal inference on the one hand, and the application of big data or administrative microdata on the other, then you can learn more about these questions that I was fundamentally interested in around environmental change and how it affects human beings and society generally.

When I started the Ph.D., I remember very vividly, this was when some of the seminal work on temperature and Gross Domestic Product growth had come out—Meslissa Dell [at Harvard University], Ben Jones [at Northwestern University], and Ben Olken [at the Massachusetts Institute of Technology] had published their paper [on temperature shocks and economic growth]. I remember walking out of a seminar room and someone, a luminary in the field, saying, “These effects seem too big to be true. Unless I have some micro evidence to give me a sense of why temperature is causing such a severe decline in macroeconomic growth, I don’t know if I can believe this.”

So, that was, in a nutshell, what motivated the work that I’ve been pursuing at the intersection of environmental quality, or climate change in particular, and economic opportunity and inequality. I’m trying to explore the nitty-gritty microeconomic details of how things such as climate change or environmental quality or air pollution might affect our day-to-day lives. I’m looking at how that translates, depending on the economic system in which these changes manifest, into either a tiny blip on the radar for someone at the higher end of the income distribution, with air conditioning in every room of their home, for instance, versus a serious reduction in health or livelihood or upward economic mobility among those on the lower end of the distribution, who may not be able to easily limit their exposure.

Garvey: Very true. That makes a lot of sense. And your answer ties into my second question, which is, can you give us a brief overview of your research agenda and the specific contributions you’re looking to make in this space?

Park: Most of my work so far has looked at, as you mentioned, temperature, and particularly how high temperatures affect things such as learning, student performance during high-stakes exams, how that translates into racial and economic achievement gaps, and the role that adaptive investments, such as air conditioning or other things, potentially play in either alleviating those effects or exacerbating inequality.

I’ve also done some work on how temperature affects workers in labor market settings—how, depending on the baseline level of hazard in which one’s work occurs, something as mundane and seemingly trivial as working on an 85 degree Fahrenheit or 90 F day can have very serious implications for workplace health and safety.

This research has been motivated by at least two broader thematic and potentially policy-relevant directions. One is to that earlier quote I mentioned overhearing at Harvard, about how we can provide more micro-founded substantiation or color to our estimates of the social cost of carbon, which is a summary measure of how serious we think climate change is for the world as a whole. This then informs our understanding of the optimal stringency of climate policy—how much we want to spend, and how quickly, on greenhouse gas emissions reductions and the clean energy transition.

But the other piece of it, which transitions into my research agenda moving forward, is really trying to understand how these subtle environmental factors and inequality in the exposure to, and ability to respond to, such environmental stressors contribute to trends in inequality that we are documenting and continue to document with more fine-grained detail. Whether that’s in the labor market, or in educational settings, or what have you.

And that’s obviously interesting from an academic standpoint, but I think it’s doubly interesting to me. The more we can understand the magnitude of the effect of environmental conditions, including temperature, air pollution, toxic chemicals, you name it, on aspects of economic opportunity, then the more we can know about potential intervention points that are effective.

To me, that is an exciting intersection of, let’s say, the longstanding environmental policy economics literature and the longstanding literature on putting environmental factors aside and just trying to understand the drivers of inequality and policies that can help either increase upward economic mobility or reduce inequality. I want to try to see if there’s any overlap in that Venn diagram of policy options.

Garvey: It’s a very commendable agenda, and one that I would urge other researchers to get on board with. I think the more environmental economists we can have in this space, the better.

Garvey: You mentioned big data and how it ties into your work about the disparate effects of climate change. Can you tell me more about the different strands of literature on which your research builds and which inspired you to use big data and other advanced empirical techniques? How do these techniques shape your work and its findings?

Park: Sure, it’s a good question. Real “big data” scientists may laugh at the kind of big data that we use, but I’m talking mostly about administrative datasets that often were not collected for the purposes of the studies that we’re engaging in—things such as test score databases, workers compensation claims, insurance claims, and tax records.

The rise of “big data” and let’s say the refinement of the tools of causal inference as well, are, in my mind, the two tailwinds that enable this kind of work in general—not just by me but also by many applied environmental and labor economists working on this growing intersection.

How does this build on the existing literature? I think we’re always standing on the shoulders of giants. Some of the giants in this context are people like William Nordhaus, and Nicholas Stern, and the folks in the climate economics literature, who built the early iterations of what are called integrated assessment models. These are large economic and physical systems models that try to help us understand how we even begin to put a magnitude on the damages from climate change, which is such an abstract and global public-good problem. Many of the integrated assessment models, until very, very recently, had a spatial resolution of 10 to 16 regions representing the whole world. That’s in part because of the data that they had to work with at the time, when they were originally developed.

What’s exciting to me is the opportunity to use the more fine-grained, highly resolved data to get at questions of how we think climate change affects any kind of outcomes, such as health, mortality, morbidity, learning, and labor productivity. And, very importantly, the bigness of the data allows us to discern or pick up signals regarding heterogeneity in a way that I think is very illuminating and consistent with our evolving understanding of inequality, and is potentially policy relevant.

What I mean by that is, even as of 10 to 12 years ago, the state of the art in terms of our understanding of climate damages was essentially that most rich economies are going to either see zero effect or even a positive effect from climate change. This was primarily because when you did the econometric analysis, the average effect netted out to a very noisy zero. But it turns out that when you marshal the micro data and look more carefully under the hood, that masks tremendous heterogeneity.

So, in the United States, for example, the effect of heat on just the likelihood of death, mortality, can vary by a factor of 5 to 10 depending on which part of the country you’re in—whether you’re in a place such as Seattle that barely has any air conditioning and where people aren’t used to days above 90 F, versus a place such as Dallas, where half the days of the year are that hot.

I’ve mentioned the spatial aspect of it, but really, what we’re beginning to learn is that even within regions, there’s sort of a vertical aspect of those who have and do not have access to a safer built environment, and those who have and do not have an occupation with the flexibility to protect themselves from the elements. This brings climate inequality closer to home, even within-neighborhood inequality. I think it’s not more important than the global North-South inequality, by any stretch of the imagination. But I think it is important to the extent that it highlights how climate change is not just something that affects poor people in the developing world—it’s people right next door.

That’s why we might as well have a clearer understanding of who is most exposed and why, and what potentially can be done about it, to minimize or reduce the level of harm over the next several decades from the warming that we’ve kind of baked into the system, regardless of what we do on mitigation.

Garvey: It’s almost like a hierarchy of comfortability, if you will, when you take it out of the North-South context.

Park: That’s right.

Garvey: So, as you noted, your work highlights how thermal inequality impacts learning and labor productivity, especially in underrepresented communities of color. What are some of the most pressing points you would like policymakers to consider as they start to draft legislation to mitigate the negative cost of rising temperatures?

Park: First, researchers will always say we need more data. But I think it is absolutely true that, in this case, we need better and more data.

Just to give you an example, when Josh Goodman [of Boston University] and I, along with our other co-authors Mike Hurwitz [of NBER] and John Smith [of Georgia State University], were writing our Heat and Learning paper, we wanted to see whether there were good data on school-level air-conditioning penetration nationally. To the best of our knowledge, it didn’t exist or at least it wasn’t accessible in a way that we could find it.

So, we had to go out and administer a nationwide survey of school air-conditioning penetration, which revealed, somewhat to our surprise, just how much variation there is in school facilities, and air conditioning in particular. Even within a given city, such as Atlanta, where it’s generally very hot, it turns out that there is a discrepancy among Black and Brown students in how likely you are to go to school with air conditioning. It would be nice to have that kind of data not just in the context of schools, but also in other contexts in which we think climate vulnerability may vary in ways that may be of societal concern.

Second, we need to be thinking about mitigation and adaptation at the same time.

Just to take a step back for those who aren’t in the weeds on climate policy. When I say mitigation, I mean policies aimed at reducing greenhouse gas emissions, which will eventually, with a long lag, mitigate or slow down, or perhaps eventually reverse, global warming. When I say adaptation, I mean what we can do to reduce vulnerability to or weaken the impact of the damage associated with the warming that is already happening.

I think it’s important for policymakers to simultaneously incorporate all of this new work into their understanding of how urgent the climate mitigation problem is. There are so many researchers in this space now, I won’t even begin to name names. But many of them are feeding into, for instance, the Biden administration’s update of the social cost of carbon. There’s an inter-agency working group for that now.

Garvey: Right.

Park: The difference between what we had in the past and what we have now in terms of the granularity of the data is so large, I think it’s worth policymakers saying, “Okay, maybe it’s time to update my priorities as to how serious the climate problem is.” And again, not just as a case of charity for developing countries, but even when thinking about their own constituents.

But also, we have to walk and chew gum at the same time, so to speak. The immediacy and the rapidity of the warming that’s already happening behooves policymakers to want to think carefully about how their constituents, particularly the most vulnerable, may or may not be adapted to the changes that we have in store. Whether that’s an increase in the number of hot days, an increase in wildfires, not only the flames themselves but also the smoke associated with wildfires, as well as flooding, sea-level rise, and so on.

Tying those two points together, I would urge policymakers to consider that just because we identify a very important problem and high inequality in, say, climate damages associated with heat or wildfires, that doesn’t mean we know exactly what the right tool is to mitigate or to adapt to that problem. And that’s where I think we still have time to leverage the tools that we now have—the big data, the administrative datasets, and the causal inferential tools—to maybe design more precise adaptation policy that is both more efficient and more equitable.

I really think that’s possible. I don’t think we have clear answers necessarily as to a silver bullet set of adaptation strategies, but I do think we have an opportunity to get ahead of the curve and make far more informed adaptation decisions.

Not to draw too tortured of an analogy, but we had to make a lot of adaptation policies on the fly in response to the COVID-19 pandemic. Many of those decisions, had we had a longer lead-up and better data to plan, could have been arguably better informed and more efficient and more equitable in terms of the implementation.

Garvey: That’s a great analogy to bring it all in. We should really swing a two-handled lever in this instance, and not just try to mitigate climate impacts down the road, but also address what’s happening currently. There are a lot of future models out there that tell us what’s coming. But, like you’ve mentioned, climate change is here. And, as your work shows, a lot of people are already dealing with the effects of it today. So, we can prepare at the top while also reinforcing the bottom.

Park: Yeah.

Garvey: I do think that’s a really good way for policymakers to think about drafting up climate legislation. Because it’s happening at both ends.

Park: Well said. And can I just add one more thing onto that? This is more of a messaging point than a technical policy point. But sometimes I find, implicit in many conversations that I hear about climate policy from either side of the aisle and among all levels of climate skepticism or urgency, there’s this assumption that unless climate change rises to the level of civilizational collapse or existential threat, that it isn’t an issue that we should act on. That has somehow been embedded in many of the conversations.

I think that’s really counterproductive because it’s very difficult to know with any kind of certainty whether we will have “climate catastrophe” that is civilization-ending in 2200 or 2300. That’s just really hard to know. But at this point, we do know with pretty high degrees of certainty what kinds of damages we have in store over the next three decades. And, at least to my calculations, those, let’s call them lower-grade burns, are maybe reason enough to act on their own.

I don’t know the right way to make that happen, but I think it is sometimes counterproductive to have a shouting match about, is climate change an existential threat or not? Whether or not we can know, the observable, high-probability, low-grade damages are pretty bad enough.

Garvey: Definitely. And to that point, some of those damages, to some people, are catastrophic level events.

Park: Exactly. That’s a great way to pull it back together. The heterogeneity is what allows us to see that a small average effect is a catastrophe for many individuals, though perhaps not for the average individual.

Garvey: That’s a really good point, and I definitely appreciate your way of framing that. Because it does just seem to be a shouting match about if acting on climate is even relevant. And, for whatever reason, we still have to have that conversation. But at the same time, people are being affected today.

Garvey: So, you’ve just given me some background really on how persuasive the issue of rising temperatures is within the grand scheme of economics. And I’m left wondering just how serious of an issue are we dealing with here? And what further research do you think needs to be conducted to uncover and reinforce the links between climate change, inequality, and economic growth?

Park: Great question. There are so many things I could say here. Let me try to illustrate the potential severity with a few stylized facts.

Even with very aggressive mitigation, we are on pace in the United States to experience dozens more days with potentially deadly extreme heat per year by 2040 or 2050. So, for instance, take a place like Atlanta. We are expecting upwards of 40 or 50 additional days above 90 F per year, on top of what they already get, by 2040 or 2050.

We know that such days can lead to highly elevated mortality risk. In fact, extreme heat already kills way more people than all natural disasters. And we’re now learning that there are subtler—but in aggregate, quite meaningful—effects of heat on various inputs to economic productivity and individual economic mobility.

So, a lot of heat is coming down the pike. I could have given you a similar stylized fact in terms of the extent of sea-level rise and storm surges, as well as wildfire risk, and so on.

Of course, just parenthetically, because I don’t want to paint too dire of picture, we absolutely can slow that down by acting on mitigation today. And, in fact, this gets lost in the debate a lot, but we’ve already reduced the trajectory of warming by 2100 considerably just in the past 10 years, both in terms of the emissions reduced and the pledges made. We’ve managed to already rein in some of the worst of climate change, and I think we can continue to do that. But at least over the next 20 to 30 years, we’ve got a lot of warming coming down the pike.

We actually don’t yet know what the full economic consequences of that warming will be, despite all the progress we’ve made. There’s still more we need to learn about the most vulnerable populations, who are typically difficult to capture in publicly available existing datasets, and the particular constraints that they might face, whether that’s the unhoused, or undocumented workers, or just workers with reduced bargaining power in general.

But there’s also a whole host of unresolved questions around how various market imperfections—whether it’s monopsonistic labor markets or imperfect information around the benefits of cooling or any number of other considerations—there are many unresolved questions around how market imperfections may or may not exacerbate the effects of climate change and the distributional implications of that.

That’s important because, again, getting back to our conversation about policy, I don’t think we know at the moment what the best policy tools are in terms of the adaptation policy toolkit. If you want to protect workers from extreme heat, is it the right thing to have a highly detailed set of requirements and standards? Or is a better, or at least complementary, thing to look at policy options that improve workers’ bargaining power or enforcement of labor rights more generally?

I don’t know the answer to that. I don’t think we know the answer to that, but I think it’s important to get answers to questions like that.

Garvey: And I think that definitely does speak to the type of research that needs to be uncovered to answer these questions. Because the heat affects so much, and rising temperatures really do give way to the sea-level rise and all the other disasters that we deal with.

Park: And if I could just add one more thing. We also don’t know how these things interact. We don’t really know. We’re beginning to learn that heat now reduces sleep quality. It increases the risk of crime. It reduces the institutional capacity, whether that’s food inspections or police patrols. It can reduce labor productivity. It can increase worker injuries. But it is still unclear how these things interact and aggregate to affect, or not, local economic growth. That’s just another example of, as you were saying, how heat affects all of these things subtly and simultaneously.

Garvey: That’s a great point. Maybe it’s because it’s too hot outside, right? We don’t know. But it really does affect behavior on so many different fronts. So, more research will really help us tackle that mitigation, and more importantly, the adaptation portion of what you were speaking to earlier.

Garvey: You definitely have a very exciting and timely research agenda. My last question for you today is on your role as a visiting scholar with Equitable Growth. What opportunities are you hoping to take advantage of during your time with us to help further develop and elevate your work?

Park: Well, first of all, I’m thrilled to be a new visiting scholar with Equitable Growth. I’m grateful for Equitable Growth’s support, not only in terms of supporting my research directly, but also helping support how that research gets translated and connecting it with people who can do things with it.

Just on a personal note, I’ve already benefited a lot from my engagements with Equitable Growth as an organization in terms of my own education about how the intersection of academia and the policy world works and can work. That’s exciting and energizing for a young researcher like myself. I’m looking forward to more of that.

To the extent that, again, a young upstart like me can be even incrementally helpful, I would love to continue the conversation around what the organization’s goals are for thinking about these intersections between not only climate change, but also other dimensions of environmental change and economic inequality. Because I know I’ll learn a lot in that process, too.

Garvey: That’s awesome. And I’m glad that we are able to offer support. We’re happy and here to contribute in any way to elevating the research. In my personal opinion, you definitely are producing very good work that is helping change the perspective of how we view climate change and the effects of climate change. You being here is going to really help us shape our climate portfolio, and we’re really excited to help lift your research and elevate you to the policymakers that are making those decisions.

Park: I appreciate that. While I’m a visiting scholar, I’m also channeling—to the extent that I can—all of the expertise of my co-authors. That’s the thing. I know that academic economic research is becoming more and more of a team sport. And if you look at what goes into one of these papers, it’s not surprising that that’s the case, given the amount of data and analysis. So, it goes without saying, but all this work is only possible because of good co-authors.

Garvey: It takes a village, right?

Park: Exactly. It takes a village to raise an academic child.

Garvey: Definitely. Thank you again, Jisung, for taking the time to speak with me today. I really appreciate it. I learned a lot from the talk, and I’m sure that those reading will definitely benefit a lot from what you’ve shared. I’m really excited to see the work that you put out while you’re here at Equitable Growth.

Park: Well, thank you.