Finance and Climate Resilience: Evidence from the long 1950s US Drought
Working Paper 31356
DOI 10.3386/w31356
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The local availability of credit shaped whether, and how, farmers adapted to the long 1950s US drought. Investment in irrigation increased substantially more in drought-exposed areas with greater access to bank finance. Overall, these areas suffered significantly less population decline, both in the short- and long term. Thus, enhancing local access to finance can enable communities to adapt to large adverse climatic shocks, limiting outmigration.
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