The value of forecasts: experimental evidence from developing-country agriculture | Fiona Burlig
Fiona Burlig is Assistant Professor, Harris School of Public Policy, University of Chicago. Fiona will be discussing the paper ‘The Value of Forecasts: Experimental Evidence from Developing-Country Agriculture’
‘Climate risk is a key driver of low agricultural productivity in poor countries. We use a cluster-randomized trial to evaluate a novel risk-mitigation approach: long-range forecasts that provide information about the onset of the Indian summer monsoon well in advance of its arrival. In contrast to traditional ex post risk coping approaches, this novel ex ante technology provides accurate information significantly before the monsoon’s arrival, enabling farmers to alter major up front input decisions. Moreover, forecasts have the potential to be disseminated cheaply, even at scale. We assign 250 villages to one of three groups: a control group; a group that receives an opportunity to purchase the forecast; and a group that is offered insurance. We present preliminary results, including on farmers’ willingness-to-pay for forecasts; how forecasts affect farmer beliefs, up-front investments, and welfare; and benchmark these preliminary effects against the canonical ex post loss mitigation tool: index insurance.’
Please email Gri.Events@lse.ac.uk prior to this event if you are interested in joining this event online (via Zoom).