Speaker
Description
Anticipatory humanitarian assistance is a novel instrument to help vulnerable households cope with climate shocks. While economists have posited that ex-post disaster aid decreases households’ investment in climate adaptation, the effect of anticipatory assistance is unknown. This paper analyses the effect of anticipatory assistance on demand for index insurance by evaluating a randomized distribution of anticipatory cash transfers to pastoralists in Mongolia. We find that receiving anticipatory cash transfers does not crowd out the uptake of insurance covering risks in the subsequent year. We find that receiving the transfer does not crowd out insurance uptake for the following year. Among households that have purchased insurance in the past, we find that anticipatory cash transfers significantly increase the probability of repurchasing insurance.
