ABSTRACT
This paper examines the historical effects of the El Nino-Southern Oscillation (ENSO) cycle on world primary commodity prices, as well as other measures of world economic activity. There is, of course, an extensive literature devoted to estimating the effects of weather on economic activity. The bulk of this work concerns the effects of relatively high-frequency changes in weather on economic activity. Although the importance of weather varies by geographic region and by industrial sector,1 a plethora of studies have documented the effects of precipitation and temperature on agricultural production,2 energy demand,3 and construction activity.4 In addition, Saunders (1993) found that Wall Street weather has significant psychological effects on daily stock market returns.
