Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/334665 
Year of Publication: 
2025
Series/Report no.: 
IZA Discussion Papers No. 18250
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Worsening climatic conditions and water scarcity pose major threats to rural livelihoods and to the economic development of arid regions. This paper evaluates a large-scale, low-cost climate adaptation program that built one million rain-fed water storage cisterns in Brazil's poorest and most drought-prone areas. Using novel individual-level administrative data and a difference-in-differences design, we show that the program substantially improved both economic and health outcomes, benefiting adults and children alike. Within ten years, household dependency on cash transfers fell by up to 34%, while formal labor income increased by 20%. Hospitalizations due to waterborne diseases declined by 16% among adults and 37% among children, and compliance with cash transfer conditionalities on child health and education improved. Additional evidence suggests that these gains were driven by a relaxation of time constraints: cisterns markedly reduced the time burden of water collection, enabling beneficiaries to allocate more time to productive activities. A cost-benefit analysis indicates a high marginal value of public funds relative to a broad range of public policies.
Subjects: 
climate adaptation
labor market
cisterns
water
health
JEL: 
Q54
Q25
Q58
J01
Document Type: 
Working Paper

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