Mis-Remembrance of Things Past: Memory and Adaptation to Climate Change

Abstract

Human memory is imperfect: we often fail to recall true events and invent false experiences. I examine the economic consequences of these cognitive limits for climate change adaptation in rural Bangladesh. I elicit environmental memories, beliefs, and adaptation decisions from 2,279 farmers across three survey waves. Using both natural variation in daily weather and a series of experiments embedded in the survey design, I test the predictions of a recall-driven belief formation model featuring endogenous memory revision. I find evidence that contemporaneous context causes memory reconstruction, distorting remembered features of past experiences. Memories impact both expectations about future environmental conditions and economic decisions linked to climate adaptation.