This is obvious. Colder places tend to have better systems of government, more social welfare and better economies.
If it's warm out all the time, people tend to want to party all the time. There's less incentive to want to work hard. It's also easier to be homeless when it's warm out. But also, it's harder to ignore homelessness when it's really cold out.
I'm going to assume this is facetious and just
link to the paper. It's a pretty standard applied micro paper, identifying the impact of temperature changes on incomes in US counties. Their main trick is that they can use a fixed effects model with relative confidence, since temperature exogenously fluctuate over the year.
Matt Yglesias, as is befitting a humanities person, extrapolates this result too much to development and growth. (let's keep in mind the most substantial effects in this paper is still 1.5%) The paper's original motivation is global warming; a common debate (and my view too) is that global warming won't really affect the U.S. much, since it has the technology and the internal market to adapt quickly. What they claim is that hot weather just saps people's productivity, dragging out production and lagging the U.S. economy. The same is true of cold weather as well, though that's a secondary concern of the authors.
Look at Figures 1 & 2 instead of the one linked in the article (which is a robustness check). Of course, with these regressions using local data there's always a risk of overstatement, because factors are mobile and can adjust between counties. But, if you buy the theory that temperature saps the productivity of those gainfully employed, this is less of a problem.
