Finance and Climate Resilience: Evidence from the long 1950s US Drought
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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