Research

Working papers

Sectoral impact and propagation of weather shocks IMF Working Paper, 2023/053
[Most recent version here]

Abstract
Despite intensified international trade and production fragmentation, local weather shocks have only been shown to affect local economic activity. This paper introduces input-output sectoral interlinkages as a transmission mechanism of weather shocks in a production network model. Using global sectoral production data from 1975 to 2020, I document that agriculture is the most adversely affected sector by local hot daily temperature shocks. Accounting for network propagation, downstream sectors, non-responsive to local weather, incur substantial and persistent losses due to the ripple effect from agriculture. Counterfactual scenarios reveal a threefold underestimation of aggregate costs induced by temperature increases accounting for shocks across trade partners. The analysis also highlights sectoral centrality in the production network as a determinant of global losses.

Adapting to climate change accounting for individual beliefs (Revise and resubmit)
[Draft available upon request]
(Previously circulated as “Do subjective perceptions shape adaptation to climate change? Evidence from Bangladesh”)

Abstract
As the climate changes, efficient climate policy development requires a better understanding of how individuals adapt. Despite extensive research on various climate adaptation frictions, including financial and technological constraints, models of adaptive decision-making assume that agents have perfect information and accurate beliefs about climate. Combining rural households' data in Bangladesh with a meteorological measure of dryness, this paper studies the role of individual drought beliefs and their accuracy in irrigation decisions as a key adaptive margin. In a theoretical model, I introduce a behavioral friction to document how heterogeneous beliefs differentially influence responsiveness to the same meteorological signal in dryness. The empirical analysis reveals an asymmetric response to dry shocks in irrigation conditional on prior belief accuracy. A counterfactual analysis shows lower technology adoption levels and higher monetary losses when beliefs are inaccurate.

Endogenous green preferences (with Ravi Vora)

Abstract
Low public support has been an obstacle to the enactment of stronger environmental policies. Yet if policies are enacted, preferences for them may change. Using surveys covering 38 countries around the world, we study the dynamics of environmental policies and individual preferences over twenty years. Exploiting within-country, across birth-cohort variation in exposure to environmental policy stringency, we document that cohorts exposed to more stringent policies in the past are more supportive of environmental policies at the time of the survey, with the effect largely driven by exposure during a period of early adulthood known as the formative age window. Therefore, environmental policy preferences are endogenous on a societal level, with implications for their predictability, as well as their moral and political economy.

Climate-induced migration and environmental values
[Draft available upon request]

Abstract
Climate concern as a political priority is crucial for gaining broad public support for climate policies. The drivers of climate attitudes have so far been identified in socio-economic and political factors and direct experience of weather shocks. This paper introduces international migration induced by weather variations as a novel determinant of climate concern. The empirical analysis leverages exogenous variation in weather in non-OECD origin countries to construct a gravity-predicted instrument for asylum demands and study their effect on individual climate concern and voting behavior for Green parties in the European Union between 2000 and 2019. Results show that weather-induced asylum applications heighten concern about climate change as a political priority. Changes in stated preferences, however, do not translate into changes in voting behavior, as there is no effect on Green party votes in the European Parliament elections. These findings are consistent with a drop-out of traditional Green voters, changes in preferences for individuals below the voting age, as well as no changes in the pro-environmental policy manifesto of political parties.

Publications

Drought exposure and accuracy: Motivated reasoning in climate change beliefs (2023)
Environmental and Resource Economics, 85, 649–672 [PDF]

Abstract
The lack of stringent policies to avert climate change has increased the importance of effective and timely adaptation. Adequate adaptation is particularly important for agricultural communities in developing countries, which may most suffer the consequences of climate change. Evidence is still scarce on how people in the most vulnerable areas form climate change beliefs and whether such beliefs exhibit cognitive biases. Using survey data from rural households in Bangladesh together with a meteorological measure of excess dryness relative to historical averages, I study the effect of long-term average drought exposure and short-term deviations on beliefs about drought frequency and the interpretation of drought events. To explore how individuals interpret past droughts, I use an instrumental variable approach and investigate whether individual beliefs lead to asymmetric distortion of objective information. The results show that individuals recollect and overweight evidence tilted towards their prior beliefs, providing evidence of confirmation bias as a directional motivated reasoning mechanism. The findings highlight the need for models that account for behavioral factors and cognitive biases in the study of climate change beliefs for effective communication and adaptation policies.

Happier Elderly Residents. The positive impact of physical activity on objective and subjective health condition of elderly people in nursing homes. Evidence from a multi-site randomized controlled trial (2022)
(with Claudia Senik, Carine Milcent, Chloé Gerves-Pinquié and Patricia Dargent-Molina)
Applied Research in Quality of Life, 17(2), 1091-1111

Abstract
We explore the effects of adapted physical exercise programs in nursing homes, in which some residents suffer from dementia and/or physical limitations and others do not. We use data from 452 participants followed over 12 months in 32 retirement homes in four European countries. Using a difference-in-difference with individual random effects model, we show that the program had a significant impact on the number of falls and the self-declared health and health-related quality of life of residents (EQ-5D). The wide scope of this study, in terms of sites, countries, and measured outcomes, brings generality to previously existing evidence. A simple computation, in the case of France, suggests that such programs are highly cost-efficient.

Work in Progress

Long-term climatic conditions and global spatial distribution of population (with Alexander Marbler)