Early warning, adaptation to extreme weather, and attenuation of economic losses: Empirical evidence from pastoral China

Early warning systems (EWSs) are a critical tool for preparedness toward extreme weather; how-ever, empirical study on the end-users of EWSs is scant. To fill this gap, we examine the effect of access to EWSs on the attenuation of economic losses, based on a unique panel household survey of 652 herder households in China's pastoral areas, which are vulnerable to natural disasters such as droughts and snowstorms. We utilize a triple-hurdle model that simultaneously estimates the determinants of three sequential dependent variables: whether an extreme weather event had oc-curred, whether economic losses were suffered, and the extent of economic losses. The results show that EWSs do not reduce the likelihood of suffering from economic losses; however, they are effective in attenuating the extent of losses among those who have suffered. In this study, EWSs significantly attenuated extreme weather-induced economic losses by approximately 42%. It is also shown that the determinants driving each of the three stages are heterogeneous. The mecha-nism analyses show that EWSs promote herdsmen's adoption of adaptation measures to extreme weather events. Our findings confirm the effectiveness of EWSs, and advocate further invest-ments in underdeveloped EWSs in developing countries.