Discounting Disaster

Land Markets and Climate Change in the Indian Sundarbans


  • Sunando Bandyopadhyay University of Calcutta
  • Sumana Bandyopadhyay University of Calcutta
  • Susmita Dasgupta World Bank
  • Chinmoyee Mallik West Bengal State University
  • David Wheeler World Bank



Indian Sundarbans; land transactions; environmental variables; tropical cyclones; salinity; coastal inundation, Indian Sundarbans; land transactions; environmental variables; tropical cyclones; salinity; coastal erosion


Data scarcity has hindered studies on the impacts of climate change on land prices in the coastal regions of developing countries. Focused on the Indian Sundarbans, this paper is at the forefront of such research. Market conditions in the region feature unregulated transactions, unenforced zoning, and a lack of disaster insurance. For many residents with hereditary land ownership, stark poverty eliminates any risk buffer provided by savings or other non-essential liquid assets. Using new household surveys and environmental data, our study hypothesizes that salinization and cyclone strikes have already adversely affected land prices. We quantify such impacts using a georeferenced panel of 342 salinity monitoring stations and a spatial raster database on all cyclonic storm strikes since 1970. Our econometric results reveal highly significant negative impacts for both factors. We use the regression results to predict land prices for the most and least favourable environmental conditions recorded in our database. The results show that these climate change–related conditions account for spatial differentials greater than an order of magnitude in land prices. Such extreme risk differentials suggest high financial and fiscal stakes, underscoring the critical importance of appropriately targeted adjustment policies.


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Author Biographies

Sumana Bandyopadhyay, University of Calcutta

Professor of Geography 

University of Calcutta

Susmita Dasgupta, World Bank

Lead Environmental Economist,

Development Economics Research Group

Chinmoyee Mallik, West Bengal State University

Assiatant Professor

Department of Rural Studies

David Wheeler, World Bank



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