New Estimates of Climate Demand: Evidence from Location Choice

Abstract

We develop and apply to Census data a new method for estimating climate demand. The method is useful for ranking quality of life based upon a willingness to pay criterion. Our two major findings are that the willingness to pay quality of life index is correlated with the hedonic approach's ranking but that the migration approach generates much larger estimates of willingness to pay for a more moderate climate. This finding is relevant for evaluating the economic impact of global warming.