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As India develops its carbon markets to mitigate climate change, it is important to consider the short-term costs for industry. Analysing data on formal manufacturing from 2009-10 to 2019-20, this article finds that energy and labour are complementary inputs in production – if an intervention such as a carbon tax raises the cost of energy and reduces its use in manufacturing, employment will go down as well.
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Human economic activities are known to have caused a rise in temperature by over 1°C since the pre-industrial era. The rise in temperature, spurred by an increase in greenhouse gas emissions, can have very adverse effects on the economy and society. A high temperature and inadequate rainfall can cause drought, damaging crops and making workers susceptible to heat-related illnesses.
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