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Abstract
We investigate the impact of heat waves on individual earnings using retrospective panel data (SHARE) matched with high-resolution weather data (E-OBS), covering over 32000 workers across 14 European countries (1955–2019) from diverse sectors and occupations. Exploiting plausibly exogenous variation in heat wave exposure across cohorts within the same generation and region, and controlling for individual fixed effects, occupational sorting, and covariate balance, we find each additional heat wave day reduces earnings by 0.31%. Losses are larger in outdoor, manual, and clerical occupations, disproportionately affecting lower-income workers and those from disadvantaged family backgrounds, but are mitigated in countries with centralized collective bargaining.