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How does global warming affect the economy? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.

Answer by David Ford, works at Sonic Sandbox, on Quora:

Global warming affects the geography within which the global economy operates. It changes growth zones. It changes shorelines. It changes the places where humans will feel comfortable living. In addition, if humans actually decide to do anything about it, it will change the way industry and people use fossil fuels.

Growth Zones

As the planet warms, the average temperature of each location will rise. This means the microhabitats where each species of plant does well, will move. Sometimes they will move towards the poles of the earth. Sometimes they will disappear, and the species will die out.

The fauna that have evolved to survive in the microhabitats will either move with the microhabitat, or, if the microhabitat disappears, they will adapt to different surroundings or go extinct. Over time, there will probably be a number of extinction events, but there will also be new species evolving that will be able to do well in the new habitation zones.

In terms of the economy, this is probably going to affect farming the most. Places where we used to grow crops may become too arid or too wet for what currently grows there. The location of where humans grow things will change. Places closer to the poles which have been too cold to have decent growing seasons will become more arable. Places that used to be the right temperature for a crop will become too hot.

Most animals that have a symbiotic relationship with humans will persist, most likely where they are. However, wild animals will have to move or die out. There may be no habitat left for some wild animals. Polar bears seem to capture the human imagination, but there will be many others that people don’t know about or don’t care about.


As the ocean levels rise, the existing shorelines will change. Of course, in geological time, shorelines have changed many times in the billions of years that earth has existed. However, human time is a much smaller scale. We’ve probably caused environmental change in the past, in Mesopotamia and the Sahara, which were lusher areas a couple of millenniums ago, but are now desert.

Humans have always been adaptable creatures, so as the ocean levels rise, many areas along the ocean shores where we live will end up being under water. This will necessitate new types of homes or possibly migration.

In terms of economic impact, people are probably going to have to migrate. This will mean a lot of new home construction. It may also mean deconstruction, as well, depending on how humans feel about letting the oceans destroy things, or about cleaning up after ourselves.

Cities on the shore will have to invest heavily in dikes and other water management systems, the way Venice and the Netherlands have already done. In fact, the places that have been dealing with water issues already and the companies that have the technologies to deal with these issues are probably companies to invest in for the long term.

In any case, humans will migrate or protect their existing investments. This will create demand for new construction. It will also increase competition for property in desirable areas, but new desirable areas will open up with global warming. If you want to take advantage of this, buy property in Canada and Siberia now, if you can.


Human productivity has been constantly increasing over human history. This means that we have been able to make more using less resources. The need to reduce the use of fossil fuels will put more pressure on industry to become more energy efficient. This will be especially true if we can find a way to get industry to pay for the cost of energy profligacy up front, instead of socializing the cost at the back end.

I can’t tell how much economic incentive there will be for efficiency. Will people be more interested in using resources, especially fossil fuels, more efficiently simply because this drives down the cost of using products? Energy efficiency has been a driver of economic change for decades now, but will it be a more important driver now that people are becoming more concerned with the impact of global warming?

As the world heats up, there will be more demand for air conditioning. That will use more energy, and it could drive up the use of fossil fuels. However, the price of fossil fuels has been decreasing lately, as humans have developed more and more resources. There was a boom in shale oil for a little while, but then there was so much of it, that oil prices dropped, making shale oil no longer profitable. Still, all that oil is still there, waiting for the prices to make it worth drilling for.


Global warming may create a demand for new technology that helps capture carbon dioxide and methane. I recently heard that in Siberia, there is a huge amount of methane that will start outgassing as the planet warms. Methane is even more effective at keeping warmth in than carbon dioxide, so once the methane starts outgassing, we may start warming even faster.

However, I’m sure that humans will develop technologies to try to capture the outgassing methane, since it will be a valuable resource. So perhaps global warming will make energy from fossil fuels even cheaper as it increases the supply. Maybe we’ll develop technologies to harvest methane from the atmosphere.

Another source of energy that will continue to grow is energy produced from renewable resources such as wind, tides, geothermal sources and the sun. If it takes more energy to manage the impact of global warming, humans will probably be able to harvest that energy in one way or another.

I believe that new technologies will be created to solve the problems that global warming creates. Humans are quite adaptable, and the money to be made as a result of the impact of global warming will be enormous. With human migration increasing as old land becomes unlivable due to heat or rising oceans, new lands will become more livable, and people will migrate to live in these newly more livable places.


Migration will cause political conflicts, but it won’t be stopped. If any country tries to keep people out, people will either sneak around, or attack if the need to migrate is strong enough. Hopefully humankind will find ways to manage the migration sensibly instead of fighting about it, but I doubt that will happen. Although it seems likely that places like Canada and Siberia will welcome the influx of people, since that will make them more powerful nations.

Global Economy

Global warming will bring new challenges to human beings, and I think that issues related to migration will be the largest driver of economic change. There will be a new economic sector built around the issues of migration, including managing migration, transportation, construction, and so on. Many of these things will be no different from the way they are now. Global warming will just change the geographic location of the need for goods and services.

Humans thrive on work, it seems. There will be plenty of work that will have to be done to cope with the human dislocation that global warming will bring. People will do this work. And if there aren’t enough people, then machines will do it.

With birth rates slowing around the world, we may run into a time of underpopulation instead of overpopulation. This probably sounds like a crazy idea to most people, but some demographers think this will happen, and I believe it is likely to happen. As technology improves around the world, birth rates will decline pretty dramatically. This will happen a lot faster than anyone currently projects, in my estimation. Reduced birth rates may ameliorate the migration issues associated with global warming.

There seems to be some belief that global warming will have a catastrophic effect, making it impossible for humankind to survive. I don’t know where this catastrophe will come from. I think humans will adapt to global warming. We are very adaptable. We will develop the economic infrastructure necessary to keep ourselves alive and thriving.

People will have to move. Some parts of the world will become less desirable, if not uninhabitable. But other parts of the world will become more desirable, and people will move to these areas, and life will probably go on, pretty much as it has been, only we will be richer and have more choices available to us.

I don’t think global warming will have a catastrophic effect on humankind. It will affect us, but we will adapt. We will change our environment, but not so much that we can’t live on this planet. Eventually, we’ll figure out how to manage the global environment in a more accurate way. Then we’ll have all kinds of political battles over what the best way to change the environment is.

The thing is: that’s exactly how it is now.

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