Drought exposure and accuracy: Motivated reasoning in climate change beliefs

Despite scientific consensus, there is no unanimity among individuals in the beliefs about climate change and its consequences. Understanding how people form these beliefs and what drives their interpretation of climatic events is essential, especially in developing countries and among agricultural communities, which may most suffer the consequences of climate change. Using survey data from rural households in Bangladesh together with a meteorological measure of excess dryness relative to historical averages, this paper studies how long-term average exposure to dryness and short-term deviations shape beliefs of increase in droughts and the interpretation of drought events. To explore how agents interpret past droughts, I use an instrumental variable approach and investigate whether individual beliefs lead to distortions of objective information in an asymmetric manner. The results show that individuals' interpretation of droughts is biased in the direction of their prior beliefs, providing suggestive evidence of confirmation bias as a directional motivated reasoning mechanism. The findings highlight the need for models that account for behavioral factors to study climate change beliefs and their implications for effective communication and adaptation policies.