Environment and Climate

The cities in Southeast Asian and Small Island Developing States have distorted the natural environment by haphazardly constructing roads, buildings, and other infrastructures. Such massive changes in the environment are altering the ecology, creating sustainable development challenges such as climate-related extreme weather events. Super Typhoon Haiyan devastated portions of Southeast Asia, particularly the Philippines, on November 8, 2013, that caused physical and psychological illnesses to the affected.

Drought is a unique natural hazard which through its multi-faceted characteristics causes damage to ecology and economy. Mitigation of drought requires a dedicated policy involving precautionary and combative measures. The state of Gujarat in India possesses an arid to semi-arid climate and suffers from recurrent droughts and perennial water scarcity problem. Droughts in Gujarat not only impart stress on the water resources but also on agriculture, economy, and socio-cultural spheres.

Extreme events are one of the main channels through which climate and socio-economic systems interact, and it is likely that climate change will modify the probability distribution of the losses they generate. The long-term growth models used in climate change assessments, however, cannot capture the effects of such short-term shocks. To investigate this issue, a non-equilibrium dynamic model (NEDyM) is used to assess the macroeconomic consequences of extreme events.

Agricultural productivity growth is vital for economic and food security outcomes which are threatened by climate change. In response, governments and development agencies are encouraging the adoption of ‘climate-smart’ agricultural technologies, such as conservation agriculture (CA). However, there is little rigorous evidence that demonstrates the effect of CA on production or climate resilience, and what evidence exists is hampered by selection bias. Using panel data from Zimbabwe, we test how CA performs during extreme rainfall events - both shortfalls and surpluses.

This paper examines the impact of floods on the firms' capital accumulation, employment growth, and productivity by using a difference-in-difference (DID) approach and considering the firms' asset structure. We find evidence that, in the short run, companies in regions hit by a flood show on average higher growth of total assets and employment than firms in regions unaffected by flooding. The positive effect prevails for companies with larger shares of intangible assets.