Climate and sovereign default risk
用内生违约模型区分慢性气候风险与急性灾害，发现慢性风险可能通过预防性储蓄渠道降低违约动机，从而提高主权债券价格。
Does climate risk necessarily raise sovereign default risk? While a growing literature documents adverse effects from realized disasters, the implications of long-term (chronic) climate risk remain unclear. Using an endogenous default model with climate shocks, we isolate chronic physical risk from acute disaster realizations. We show that higher climate risk can increase sovereign bond prices by reducing default incentives. Risk-averse governments value continued market access as insurance against future shocks, strengthening repayment motives. While acute disasters still depress prices on impact, chronic risk can operate through a precautionary channel.