Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/89168
Authors: 
Bastos, Paulo
Busso, Matias
Miller, Sebastian
Year of Publication: 
2013
Series/Report no.: 
IDB Working Paper Series IDB-WP-466
Abstract: 
We examine the long-term impacts of drought on local labor markets in Brazil. Us- ing rainfall data going back over a century, we build contemporaneous and historical drought indices for more than 3,000 local areas, and examine them in conjunction with five waves of population census data spanning 1970-2010. Results from a difference- in-differences design reveal that increased drought frequency in the previous decade reduces local value added, employment and wages in the agricultural sector; leads to job losses and pay cuts in the local manufacturing and services sectors; and induces out-migration, especially among younger cohorts, leading to relative population de- cline. These findings are in line with standard general-equilibrium theory featuring imperfect labor mobility across space.
JEL: 
J61
N96
O15
Q54
R11
R23
Document Type: 
Working Paper

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