New experiments show the power of giving cash right before extreme weather strikes

By: Sigal Samuel

If you’re reading this, you probably care about fighting climate change. But what does that actually mean to you?

Chances are, you take it to mean supporting climate change mitigation: reducing the flow of greenhouse gases into the atmosphere by replacing fossil fuels with renewable energy.

But there’s another aspect to the fight against climate change: adaptation. Adapting to life in a more dangerous climate involves building resilience to weather shocks — for example, by constructing a seawall or planting crops that can withstand droughts and floods.

Mitigation is vastly more popular than adaptation. Of all the funding directed toward fighting climate change globally, over 90 percent goes into the mitigation bucket. And I can’t claim to be surprised: For years, I’ve mostly focused on that bucket, too. I saw mitigation as the way to solve climate change, while adaptation seemed like putting a Band-Aid on one of the world’s biggest problems.

And yet, who determines the time scale of our response to that problem?

For many people — especially poorer people in poorer countries — the problem is now. Climate change is already flooding their homes and causing them heatstroke. It would be unjust for richer countries that disproportionately created the problem to say “we get to determine the time scale of the problem, not you, and we’re deciding to frame the problem as a future event to be mitigated.” Climate change is also a present event, so solving it also means addressing the problem as it exists today.

“If you look at some river that’s started flooding now, no matter what we do in even the next 100 years, these rivers are going to continue flooding,” said Miriam Laker-Oketta, a Uganda-based research director at GiveDirectly, a nonprofit helping the world’s poorest.

She was referring to the fact that it will take decades to decarbonize the world’s energy supply, and meanwhile all the carbon we’ve emitted and keep emitting will continue to warm the atmosphere for hundreds of years. Money spent to mitigate emissions will pay off over the long term but do little to protect a country from climate change right now.

“We need to increase the amount that’s dedicated to helping people adapt,” she told me.

One approach to adaptation is to direct funding to governments so they can build up the infrastructure — whether that’s a seawall or a new irrigation system — to reduce the impacts of shocks. These big public goods are definitely important, and they should get a larger share of climate financing than they do today. But implementing major projects like these can take time. If you’re, say, a smallholder farmer whose food and income source is about to be wiped away by a climate change-enhanced cyclone, you don’t have that time.

So a nascent approach to adaptation aims to help vulnerable people by giving them just-in-time cash transfers. That means free money, no strings attached, that recipients can use to improve their resilience in the days or weeks before extreme weather hits. Researchers can pinpoint when and where it’ll hit thanks to advances in data availability and predictive analytics. Recent experiments show how successful this approach is, making the case that anticipatory cash transfers should play a bigger role in climate adaptation.

How just-in-time climate cash transfers work

Humanitarian relief organizations are used to doing two things: helping people out after disaster has already struck, and helping them out by giving them stuff. A hurricane strikes, and in comes the Red Cross or the United Way with water and tarps for victims.

Just-in-time climate cash transfers turn that model on its head.

First, they offer people support before the shock hits, making them more resilient and limiting the economic and human damage when it comes. Second, they give straight-up cash. Not food. Not Super Bowl merchandise from the team that didn’t win the Super Bowl. Money.

We know from research on poverty alleviation that cash is preferable because it gives people the agency to buy the things they really need, as opposed to what outsiders think they need. And it can be disseminated much faster than goods, thanks to cellphone-based banking. Cash is now considered the baseline standard for challenges like poverty alleviation, with other interventions judged on whether they’re superior to cash.

And in the past few years, evidence is mounting that cash works very well for climate adaptation, too. Let’s look at three examples.

In July 2020, data-driven forecasts of river levels in Bangladesh showed that many households were about to experience severe flooding. The World Food Programme sent 23,434 households around $53 each a few days prior to and during the floods.

The preemptive action turned out to be a great bet. Those floods ended up being some of the worst and longest in decades: Over a million households were inundated, and food markets and health services were disrupted.

Compared to households that didn’t get a cash transfer, households that did were 36 percent less likely to go a day without eating, 12 percent more likely to evacuate household members, and 17 percent more likely to evacuate their livestock.

And the impacts were surprisingly durable. As the study authors write, “Three months after the flood, households that had received the transfer reported significantly higher child and adult food consumption and wellbeing. They also experienced lower asset loss, engaged in less costly borrowing after the flood, and reported higher earning potential.”

Soon after, the World Food Programme also tried anticipatory cash transfers in Somalia and Ethiopia, with similarly positive results: The cash infusions protected communities’ food security and livelihoods from the worst impacts of a forecasted drought.

In 2021, the government of Niger kicked off its own anticipatory cash transfer program for responding to water scarcity. The pilot program detects droughts early by using the satellite-based Water Requirement Satisfaction Index. When the index shows that water has fallen 10 percent below its median at the end of the agricultural season, it automatically triggers the unconditional cash transfers to be sent out.

The trigger was activated for the first time in November 2021, and since March 2022, emergency transfers have been sent to 15,400 drought-affected households. These transfers have allowed farmers to get help three to five months earlier than they would if they were just relying on traditional humanitarian aid. And receiving the support earlier meant they were less likely to have to resort to coping responses with costly social effects like reducing food consumption or pulling kids out of school.

The nonprofit GiveDirectly, a big believer in unconditional cash transfers, launched a climate adaptation program last year in Malawi. The extremely low-income country — where nearly three-quarters of the population lives on less than $1.90 a day — has already been hit with climate-related storms, with more expected to come.

Knowing how climate-vulnerable Malawi is, GiveDirectly gave 5,000 farmers in the Balaka region two payments of $400, one in April and one in October, to coincide with key moments in their agricultural schedule. October is also the beginning of the wet season, when 95 percent of precipitation falls, meaning it’s when cyclones and extreme weather are most likely to occur.

Simultaneously, a group called United Purpose gave the farmers trainings on climate-smart agriculture, irrigation practices, and soil conservation. GiveDirectly and United Purpose had coordinated on timing, but they didn’t inform the farmers of the connection because they didn’t want to make the farmers feel they were expected to spend the cash on building climate resilience. They wanted the cash to be truly unconditional.

The results so far are promising. More farmers are using better seeds (which are drought- and flood-resistant), more are intercropping (which improves fertility), and fewer are going hungry (specifically, there was about a 60 percent drop in the proportion of recipients who went a whole day without eating).

For Laker-Oketta, the research director at GiveDirectly, it’s clear that anticipatory cash transfers for climate adaptation are a good idea. “The cash we give is not sufficient to put up a seawall — that’s something governments have to do,” she said. “But the lowest-hanging fruit is actually giving people agency to make certain decisions they need to make now. The question is not, ‘Does cash work?’ but, ‘What is the right amount, frequency, and timing?’”

Now, GiveDirectly is planning to experiment with the timing. They want to see if getting cash to people mere days before a weather shock, as opposed to weeks before, improves resilience more. So they’re launching a pilot with the government of Mozambique to give out just-in-time transfers, sending people around $225 just three or four days before the next flood strikes.

In January, they began pre-enrolling individuals in vulnerable villages, which are selected by overlaying poverty maps, population data, and flood risk maps. That way, people will be able to get fast payments directly ahead of likely storms during the rainy season in March and April.

“The best adaptation is to be rich”

Climate mitigation and climate adaptation, along with poverty alleviation, are all absolutely crucial if we want a safe and just world. They’re also expensive, with mitigation projects alone slated to cost trillions over the next decade. How should the world divide funding between them?

When it comes to climate financing, the United Nations has called for a 50/50 split on mitigation and adaptation. But what we see so far is still more like 90/10 in mitigation’s favor — a sore point at last year’s COP27 climate conference in Egypt. And instead of giving poorer nations additional money for adaptation, some rich nations have diverted development aid — which is already insufficient — to fund more mitigation projects.

Charles Kenny, an economist and senior fellow at the Center for Global Development, thinks that’s a terrible idea. As he’s written, foreign aid would be a drop in the bucket if it’s diverted to mitigation projects. But it can have a meaningful impact on countries with small economies by reducing poverty and fostering development (including infrastructure, health, and education). And development is a vital adaptation defense for these countries because it makes them less vulnerable to climate change.

“The best adaptation is to be rich,” Kenny told me. “Take the same size earthquake or cyclone or hurricane, and the number of people who die is considerably smaller in richer countries and even richer neighborhoods of countries.”

In other words, climate adaptation and reducing poverty go hand in hand.

That’s part of why Laker-Oketta, the GiveDirectly research director, said her organization didn’t worry about whether recipients would spend their unconditional cash on building climate resilience or on something else. “If someone makes the decision to spend the money on something else, it means that was their priority at that time,” she told me.

For Laker-Oketta personally, climate resilience was very much the priority the day we spoke. It’s currently supposed to be the dry season in Uganda, where she lives, and yet it was raining. Just hours before our call, her office flooded.

“I believe a lot of people who want most of the funding to be focused on mitigation are people who are not being directly affected by climate change right now,” she said. “Their only worry is, ‘If the climate gets worse, then I’ll be affected as well, so can we put as much as is necessary into preventing me from being part of those people who are affected?’ But if you’re living in a place where it’s flooding right now, then you’re going to think differently. Right now, what I need is a way to stop the rain from coming in!”

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