Institutional, Energy, and Social Drivers of Climate Vulnerability, Losses, and Mortality: A Statistical Study of Asia and the G7 (2000–2024)”

Abstract

There is also growing recognition of climate change that is a structural risk that is preconditioned by the governance capacity, economy system, distributive and energy systems between human and economic consequences more than hazard exposure. Although similarly affected by climatic shocks, countries are highly varied in the nature of death tolls, economic and sectoral exposure to climate change, which point to the idea that climate effects serve as mediating factors between institutions and development pathways. To explain these cross-country differences, this paper hypothesizes and tests an integrated climate-risk governance framework, having a comparative focus on Asian economies and the G7 countries. The measure of analysis uses balance panel data that was specifically drawn on internationally accepted sources and three compensatory outcome measures; climate-related mortality, economic losses caused by disasters and agricultural vulnerability. Core structural determinants are institutional quality, income levels, income inequality, renewable energy transition and foreign direct investment. To overcome the problem of unobserved heterogeneity, endogeneity, and persistence of climate impacts, fixed-effects and dynamic System-GMM estimators are used. A large range of diagnostic, robustness, heterogeneity, and sensitivity tests are conducted to assure the model validity. Empirical findings reveal that, enhanced levels of institutional quality and level of income enables a considerable decline in mortality and economic losses on climatic account, whereas increased renewable energy penetration decreases exposure to the vulnerability in the long-term. Conversely, the impact of income inequality on climatic damages is systematic especially in the Asian economies, as it dilutes the redistributive ability as well as adaptive mechanisms. The outcomes of climate also happen to be path dependent whereby the historic losses augment the vulnerability of future with a lackluster structural reform. These results are strong compared to other specifications and subsamples. All in all, the paper has shown that climate resilience is a result of governance- and development-based achievement, in which institutional empowerment, inclusive development, and energy transformation play the pivotal role of minimizing long-term climate risks.