R E S E A R C H

Publications

Assessing fishing effects inside and outside an MPA: The impact of the Galapagos Marine Reserve on the Industrial pelagic tuna fisheries during the first decade of operation. Marine Policy, Vol. 87, pp. 112-125, January 2018. (with Santiago J. Bucaram, Alex Hearn, Willington Rentería, Rodrigo H. Bustamante, Guillermo Morán, Gunther Reck & José L. García). [link]

Abstract: The conservation benefits of the Galapagos Marine Reserve (GMR), created in March 1998, have been consistently proved for endemic species and populations with limited movements. Yet, to date, no study has explored its effects on highly-migratory pelagic species, such as tuna. To this end, the impact of the GMR on the behavior and productivity of tuna fisheries in this region is analyzed. After considering other potential factors, which occurred approximately over the same period (i.e. increase of fleet size, changes in fishing technology, and climatic events, among others), it was found that the creation of the GMR increased fishing productivity in both the Galapagos Exclusive Economic Zone (EEZ) surrounding the GMR, as well as inside the marine reserve. However, the effect was heterogenous among tuna species – the GMR had a positive impact on the fishing productivity of yellowfin tuna (YFT) and skipjack tuna (SKJ) fisheries, but did not have any significant effect on that of bigeye tuna (BET). Then, it is proposed that the GMR effect might be dissipated by the overuse of Fish Aggregating Devices (FADs), especially in the case of BET.

Work in Progress

Resilience Investment and Aggregate Adaptation to Disaster Shocks

Abstract: This paper studies how resilience investment shapes long-run adaptation to disaster risk in a dynamic general equilibrium growth framework. The economy accumulates productive capital and resilience capital; resilience capital reduces disaster-induced depreciation through a nonlinear protection technology determined by the protection ratio (resilience capital divided by productive capital) and baseline standards. Disaster risk is summarized by the expected depreciation rate implied by a probabilistic shock process. Our quantitative analysis focuses on the model’s stationary equilibrium and steady-state counterfactuals rather than transition dynamics. In steady state, higher disaster frequency or intensity raises expected capital losses and lowers output and consumption, even as optimal protection increases. Comparative statics highlight threshold effects: at low to moderate risk, protection responds smoothly, while sufficiently severe shocks induce disproportionately large increases in the protection ratio that can reduce effective depreciation. Quantitatively, broad productivity gains deliver the largest welfare improvements; when resources are tight, policies that raise resilience productivity or resilience effectiveness are cost-effective complements. The results emphasize that productive capacity is decisive for the optimal resilience mix and provide guidance for standards and financing aimed at strengthening macroeconomic resilience.

Stress-Testing IMF Debt Sustainability Models: Integrating Climate Risks into the Debt Dynamics Tool for Colombia and Peru (with Kevin P. Gallagher and Franco Maldonado)

Abstract: The International Monetary Fund (IMF) has recently moved to expand its mandate to the macro-critical aspects of climate change and climate change policy across its surveillance, advice, and financing activities. In terms of surveillance, one of the most important roles the IMF will need to play is to ensure that member states are able to respond to climate shocks and mobilize the necessary resources to transform their economies toward low carbon and resilient growth paths in a fiscally sound and financially stable manner. A key tool to address this is the IMF’s Debt Sustainability Analysis (DSA), and the related Debt Dynamics Tool (DDT). In this paper, we adjust the IMF's DDT methodology to integrate climate risks and climate transition resources needs in an application to Colombia and Peru. Our examination reveals that climate-related risks may significantly impact a nation’s public debt trajectory, leading to substantial escalation and even raising the likelihood of severe stress events. Crucially, our analysis underscores the necessity for new methodological approaches and data collection mechanisms at the Fund to formally incorporate climate change considerations into the DSA and/or the DDT. By doing so, the IMF would be empowered to provide more precise advice and engage in more fruitful conversations with its member nations.

Assessing Economic Preparedness in Copying with Climate Shocks

Abstract: This paper examines the economic consequences of climate change and natural disasters on developing countries, with a focus on the impact of climate shocks on GDP and sovereign debt. Examining seven Eastern Caribbean countries, the study provides a model that explains the dynamic between climate events, GDP, and sovereign debt. By proposing a novel approach for discerning the alterations in a nation's production dynamics when confronted with the impact of a climate shock, our objective is to assess the economy's level of readiness in effectively managing such unexpected contingencies. The study finds that climate shocks can have a significant impact on a country's GDP and its ability to service its debt, with the probability of default increasing significantly in the aftermath of a hurricane or natural disaster. The paper highlights the importance of climate adaptation measures in reducing the impact of climate shocks on vulnerable populations. The findings of this study have important implications for policymakers and financial institutions in developing countries. We underscore the need for proactive measures to mitigate the impact of climate shocks on economic growth and financial stability. In particular, we highlight the importance of building resilience to climate shocks through investments in climate adaptation measures, such as early warning systems, disaster risk reduction, and climate-smart agriculture. The study also emphasizes the need for international cooperation and support to help developing countries cope with the economic consequences of climate change and natural disasters.

V20 Debt Review: An Account of Debt in the Vulnerable Group of Twenty. 4th Edition (with Marina Zucker-Marques and Rishikesh Ram Bhandary)

Abstract: This fourth edition of the Debt Review examines how sovereign debt burdens, debt-service pressures, borrowing costs, and the structure of external finance constrain climate-resilient development across V20 economies. Drawing on updated evidence on debt stocks, debt distress ratings, debt service, domestic interest burdens, creditor composition, sovereign spreads, and export performance, we show that debt vulnerabilities remain widespread and that fiscal space is increasingly compressed across much of the group. In 2024, a growing share of V20 countries devote more than 10 percent of government revenue to external debt service, while high domestic interest burdens further intensify trade-offs between debt servicing, public investment, and social spending. The analysis also shows that the implications of tighter global financial conditions depend critically on creditor composition and market access. Countries with larger bond shares are more exposed to shifts in spreads, refinancing risk, and rollover pressures, whereas low-income countries with limited bond debt rely more heavily on concessional finance, reprofiling, and coordinated debt treatment. Debt swaps may therefore provide targeted liquidity relief where market access remains intact, but they are not a substitute for broader restructuring where countries face market exclusion or debt distress. Overall, we argue that durable debt resolution and affordable long-term finance are central to resilience investment and macroeconomic stability

Books

Environmental Case Studies in Latin America: Innovative Financial Solutions (with Santiago J. Bucaram, Elizabeth Tamayo and Alexandra Velasco) - in progress.

Contributions to reports for intergovernmental organizations

Assessing the Current Performance of Tuna Fisheries in the Eastern Pacific, Utilizing the World Bank’s Fishery Performance Indicators (FPI) Methodology for Fisheries in Areas Beyond National Jurisdiction (ABNJ) – for World Wildlife Fund and World Bank
Assessing local vulnerability to climate change in Ecuador and Uruguay – for World Wildlife Fund
First economic assessment of the rights-based management (RBM) pilot for the industrial fishery of titi shrimp (i.e. Protrachypene Precipua) in the Gulf of Guayaquil – Ecuador – for Inter-American Development Bank