We estimate the impact of subsequent droughts on the revenues of farmers in Ethiopia factoring in their adaptive capacity. We find that after the first drought, there is no significant difference in the revenue of the farmers who experienced a drought, as compared to those who did not. However, there is a loss in revenue after the second drought, specifically for those farmers that are endowed with less assets. This finding underscores that a rise in the frequency of extreme events and shocks can potentially have significant local distributional implications, with wealth as a major distinguishing factor.

High temperatures have been shown to affect human cognition and decision-making in a variety of settings. In this paper, we explore the extent to which higher temperatures affect judicial decision-making in India. We use data on judicial decisions from the Indian eCourt platform, merged with high-resolution gridded daily weather data. We estimate causal effects by leveraging a fixed effects framework. We find that high daily maximum temperatures raise the likelihood of convictions and these results are robust to numerous controls and specifications. Our findings contribute to a growing literature that documents that the negative impacts of rising temperatures are often more severe in low- and middle-income countries.

Natural resource extraction is an important livelihood strategy for poor rural households in developing and emerging countries. Despite the sharp decline in poverty in Vietnam, inequality still exists between the ethnic majority and minority. This paper aims to analyze the impact of natural resource extraction on ethnic inequality. We use panel data from Dak Lak in the Central Highlands of Vietnam. The Oaxaca-Blinder decomposition shows that ethnic differences in extraction are due to different group characteristics and different returns to these characteristics. Endogenous switching regressions find that extraction has heterogeneous effects on consumption across extracting and non-extracting households, and between majority and minority households. Treatment effects suggest that extraction sustains the consumption of extracting minority households because their consumption would decline if they stopped extracting. Our results indicate that it is important to improve the natural resource base and the ability of minorities to cope with shocks.

We propose a model of international oligopoly with two countries, two vertically-differentiated goods, and heterogeneous consumers in terms of their willingness to pay for quality. Various sources of pollution are taken into account: consumption, production and the transportation of goods between the two countries. Green persuaded consumers display consumption home bias: they derive additional satisfaction when consuming a domestic good because buying locally abates transportation pollution. We investigate whether consumption home bias effectively curbs global emissions. Finally, we uncover the environmental role played by the globalization of markets.

This paper studies the effects of drought shocks in a vulnerable environment – the Brazilian Semi-Arid. We analyze the impact of drought shocks, measured as deviations from long-run historical averages, on agricultural outcomes in a region that suffers recurrently from drought. After controlling for municipality and year fixed effects, we use weather shocks to exactly identify outcomes. Our benchmark results show substantial effects on the loss of crop area and on the value of agricultural output, as well as on crop yields. As we investigate distributional effects, our results show that crops related to familiar agriculture suffer more from drought shocks. We follow our investigation by testing heterogeneity effects and show that adequate water provision and maintenance of forest cover help in reducing the impact of drought shocks.