The Financial Cost of Climate Legislation: The Case of Commercial Banks (with Ablam Apeti, Whesley Boungou, Bossoma Doriane Ndoua). Submitted.
This paper examines how national climate legislation affects commercial banks’ lending and performance, using data from 1,223 banks across 89 countries between 1990 and 2020. Combining entropy balancing with a difference-in-differences framework, we find that climate legislation leads to a significant contraction in lending and a decline in performance, primarily via reduced net interest income. Event study results show lending declines intensify by year six, while performance deteriorates more gradually but persistently. Although banks adjust by raising fee income and cutting personnel costs, these responses only partially offset revenue losses. The effects are more pronounced for larger, more liquid, and less deposit-reliant banks, and for executive climate legislation. A dynamic threshold model suggests a nonlinear impact: lending and performance decline sharply once policy intensity exceeds a critical level. These findings underscore the transitional costs of climate regulation for financial intermediaries and highlight the need for complementary support measures.
“Do Grassland Conservation Subsidies Influence Farm Efficiency ? Evidence from a French Natural Experiment”. (with and Lionel Vedrine). Submitted.
In this paper, we investigate the impact of an exogenous source of income support variation related to Less Favored Areas (LFA) and the grassland premium (PHAE) on farms' technical efficiency (TE), environmental efficiency (EE), and grassland conservation in France. We exploit the 2015 CAP reform, which serves as a natural experiment since it affects three groups of farms differently. We employ a combination of difference-in-differences and inverse propensity score weighting, comparing farms that benefited from an increase in LFA payments (winners) to farms that did not experience a change (neutrals). We also compared farms that suffered from the loss of the grassland premium (losers) to neutral farms. Our findings suggest that the variation in income support has led to a reduction in TE without significant effect on EE.
“Agricultural Household Resilience Strategies Against Climatic and Health Shocks: Drought and Covid-19 in the Niayes Area of Senegal”. Draft available. (with Awa Diouf)
Agriculture employs the poorest populations in developing countries and must ensure food security in a continent marked by a high prevalence of famine. However, it is one of the most vulnerable sectors to shocks. This article studies the behaviour of farmers facing drought and Covid-19 in Senegal. More precisely, we seek to highlight the effectiveness of two endogenous resilience strategies (off-farm activities and farm good sales) and an exogenous resilience strategy (accessing government and/or NGO support) applied by farmers who suffered from drought as the most severe shock during the 2017-2018 agricultural campaign. We then further analyse the resilience strategies put in place by food system actors in the Niayes area to cope with the negative effects of Covid-19 and associated policy restrictions. The results show that endogenous resilience strategies were less effective than exogenous strategies in coping with both drought and Covid-19. For drought, off-farm activities appear effective when applied as a secondary resilience strategy to complement another resilience method. However, the sale of farm assets made it difficult for farmers to cope with the drought – indeed; this strategy reduces the production capacity of farmers and can cause a decline in farm income. When it comes to the Covid-19 shock, the resilience strategies adopted were very diverse, depending on the main source of revenue but also on the farm’s spatial location and socio-demographic characteristics. Overall, however, based on these results, government and NGO support appears to have most effectively enabled farmers to adapt to climate shocks, and these supports also helped farmers during the Covid-19 pandemic, especially the most vulnerable.
“Do Agricultural Public Spending Influence Food Security, Productivity and Environmental Conservation in Africa?” Draft available. To be published in the Journal of African Transformation
In this study, we investigate the impact of agricultural public spending on food security, agricultural productivity, and agricultural environmental emissions in Africa. Employing an instrumental variable method on a dataset of forty-two (42) countries over the period 2000-2019, our results indicate that agricultural public spending has a positive influence on food security, contributing to improved access to nutritious food and reduced levels of hunger and malnutrition. However, we also find that increased agricultural public spending is associated with a negative impact on environmental emissions, suggesting that greater investment in agriculture may exacerbate environmental degradation in some cases. Furthermore, our analysis reveals a negative effect of agricultural public spending on agricultural productivity. Interestingly, our findings highlight significant heterogeneity in the effects of agricultural public spending across the African continent. Specifically, East Africa emerges as a region where agricultural investment yields positive outcomes across all three indicators of interest.
“The Forest Taxation and Log Export Ban Effect on Deforestation: Quasi-experimental Evidence from Cameroon”. Draft available [Pre-doctoral work].
Forest conservation is undeniably crucial in the fight against climate change. With the second-largest tropical forest globally, Central African countries, possessing a significant role, have undertaken reforms in forestry codes, including the definition of forest taxation. This study evaluates the impact of a combination of forest taxation and a partial log export ban on deforestation in Cameroon. Using geographic regression discontinuity, with national borders between Cameroon and Gabon as a source of exogenous variation in forest policy management, our results indicate that the implementation of these measures has led to an increase in deforestation in Cameroon. These findings remain robust across various specifications, both parametric and nonparametric.