Poor regions suffer more from extreme weather

We know that extreme weather caused by climate change does harm poorer countries more than richer ones. Much of this is due to these poorer countries being located closer to the equator and not in temperate climates. But new research shows that even within rich and temperate Europe, extreme weather events hurt countries with lower GDP per capita more than richer parts of the continent.

A group of researchers from the University of California and the University of Milan examined the exposure of 40 European countries to the seven dimensions of extreme weather measured in the European Extreme Events Climate Index (E3CI). The index is available for free and measures the frequency and severity of maximum and minimum temperatures, extreme precipitation, extreme wind, hail, drought, and fires. The chart below shows the aggregate index that combines all seven hazards into one. Unsurprisingly, the index is showing a rising trend of extreme weather events becoming more frequent.

E3CI in three major European countries

Source: E3CI

A couple of months ago, I wrote how some extreme weather events in Europe can have a long-lasting economic impact while others can be dealt with rather easily. In the E3CI index, all kinds of extreme weather events are lumped together but if you are interested in specific hazards, you can read about them in the paper yourself.

The bottom line is that an 0.1-point increase in the E3CI on average reduces GDP/capita by 0.25%. However, if extreme weather events hit countries or regions with lower economic growth, i.e. regions that are already in recession or are structurally weak, the impact of the extreme weather events becomes disproportionately larger.

The chart below shows the average GDP/capita impact depending on the prevailing GDP/capita growth rate before the event. I have added a trend line to make it easier to see that the impact grows exponentially. Countries and regions that have little in terms of economic buffer can quickly be pushed off a cliff when extreme weather hits – even in supposedly richer countries.

Hence, if you are living or investing in a country or region that is poorer or struggling economically, the negative effects of climate change need to be factored in more prominently than if you live or invest in the richest parts of the continent.

GDP/capita impact of extreme weather events

Source: Chauvet et al. (2025)