Is Climate Change Slowing the Urban Escalator out of Poverty ? Evidence from Chile, Colombia, and Indonesia

Shohei Nakamura, Ksenia Abanokova, Hai-Anh Dang (), Shinya Takamatsu, Chunchen Pei and Dilou Prospere

No 10383, Policy Research Working Paper Series from The World Bank

Abstract: While urbanization has great potential to facilitate poverty reduction, climate shocks represent a looming threat to such upward mobility. This paper empirically analyzes the effects of climatic risks on the function of urban agglomerations to support poor households to escape from poverty. Combining household surveys with climatic datasets, the panel regression analysis for Chile, Colombia, and Indonesia finds that households in large metropolitan areas are more likely to escape from poverty, indicating better access to economic opportunities in those areas. However, the climate shocks offset such benefits of urban agglomerations, as extreme rainfalls and high flood risks significantly reduce the chance of upward mobility. The findings underscore the need to enhance resilience among the urban poor to allow them to fully utilize the benefits of urban agglomerations.

Date: 2023-03-28
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Journal Article: Is Climate Change Slowing the Urban Escalator Out of Poverty? Evidence from Chile, Colombia, and Indonesia (2023)
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