Adapting to Climate Risk With Guaranteed Credit: Evidence From Bangladesh

• 成果类型: Article
• 署名作者: Lane, Gregory
• 署名单位: University of Chicago; National Bureau of Economic Research
• 刊物名称: ECONOMETRICA
• ISSN/ISSBN: 0012-9682
• DOI: 10.3982/ECTA19127
• 发表日期: 2024
• 页码: 355-386
• 关键词: Microfinance; insurance; Microcredit; demand; IMPACT; agriculture; flexibility; MARKETS; floods

摘要

Climate change is increasing the frequency of extreme weather events, with low-income countries being disproportionately impacted. However, these countries often face market frictions that hinder their ability to adopt effective adaptation strategies. In this paper, I explore the role of credit market failures in limiting adaptation. To achieve this, I collaborate with a large microfinance institution and offer a randomly selected group of farmers access to guaranteed credit through an Emergency Loan following a negative climate shock. I document three key results. First, farmers who have access to the emergency loan make less costly adaptation choices and are less severely affected when a flood occurs. Second, I find no evidence of adverse spillover effects on households that did not receive the Emergency Loan. Finally, I demonstrate that providing the Emergency Loan is profitable for the microfinance institution, making it a viable tool for the private sector to employ in similar circumstances.