The impact of extreme climate events and agricultural diversification in the British West Indies, 1850–1960

This paper examines the impact of droughts and hurricanes on key agricultural exports in the British Caribbean between 1850 and 1960, and investigates how diversification shaped economic outcomes. Using export data gathered from Colonial Blue Books, along with proxies for drought and hurricane exposure, the analysis shows that extreme climate events affected crops unevenly: while cocoa, cotton, coffee, coconuts and bananas experienced major declines, sugar proved relatively resilient. Counterfactual estimations reveal that diversification often worsened revenue losses during extreme events, especially in colonies that shifted away from sugar toward less climate-resilient crops. These findings challenge the widely held assumption that diversification inherently reduces risk, showing that it may, in certain contexts, increase economic vulnerability to climate shocks.