Bridging the Climate Finance Gap: Adaptive Capacity and Vulnerability of Smallholder Farmers’ in the Drought-Prone Northwest Region of Bangladesh

Bridging the Climate Finance Gap: Adaptive Capacity and Vulnerability of Smallholder Farmers’ in the Drought-Prone Northwest Region of Bangladesh | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Bridging the Climate Finance Gap: Adaptive Capacity and Vulnerability of Smallholder Farmers’ in the Drought-Prone Northwest Region of Bangladesh Subrina Ahmed Shanta, Md Shohidul Islam, Bikash Chandra Ghosh This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7045623/v1 This work is licensed under a CC BY 4.0 License Status: Published Journal Publication published 04 Dec, 2025 Read the published version in Discover Sustainability → Version 1 posted 18 You are reading this latest preprint version Abstract The threat of climate change-induced drought poses a serious challenge to Bangladesh's smallholders, and despite the effectiveness of the adaptation measures, financial barriers often hinder their adoption—a factor frequently overlooked in existing studies. This study addresses that gap by investigating the nexus between farmers' financial situation and their production, vulnerability, and the effectiveness of various adaptation strategies. Using cross-section data from 300 farm households across two climate-affected districts of northwestern Bangladesh, the study employs a two-step Stochastic Frontier Model (SFM) analysis to evaluate the nexus between rice productivity and climate adaptation strategies. To further explore the financial barriers to adaptive capacity, the Harrod-Domar growth equation and Multivariate Probit (MVP) regression were utilized. Moreover, the Foster-Greer-Thorbecke (FGT) index was applied to assess farmers' vulnerability to climate change. Results from the two-step SFM reveal that the use of seedlings and expansion of farm size significantly enhance productivity. The Harrod-Domar growth equation reveals an average finance gap of $190 per bigha, with 93% of farmers requiring $300 or less to enhance efficiency. Moreover, the MVP regression shows that reducing the financial gap substantially increases the likelihood of adopting water harvesting (81.89%) and drought-tolerant crops (77.25%), both of which contribute to higher productivity. Finally, FGT analysis reveals that 87% of farmers are vulnerable to climate impacts; however, providing just $90 per farmer could notably reduce this vulnerability. The results highlight the crucial importance of focused financial assistance in enhancing resilience. Therefore, government agencies and NGOs should prioritize the provision of appropriate loans, financial assistance, advanced irrigation technology, and agricultural extension services to empower smallholder farmers to optimize productivity and meet production targets. Climate induced drought Financial barriers Stochastic Frontier Model (SFM) Analysis Harrod-Domar Growth Model Farmers Vulnerability Index Bangladesh Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Published Journal Publication published 04 Dec, 2025 Read the published version in Discover Sustainability → Version 1 posted Editorial decision: Revision requested 03 Sep, 2025 Reviews received at journal 11 Aug, 2025 Reviews received at journal 11 Aug, 2025 Reviews received at journal 09 Aug, 2025 Reviews received at journal 07 Aug, 2025 Reviewers agreed at journal 31 Jul, 2025 Reviewers agreed at journal 30 Jul, 2025 Reviewers agreed at journal 30 Jul, 2025 Reviewers agreed at journal 30 Jul, 2025 Reviewers agreed at journal 30 Jul, 2025 Reviewers agreed at journal 29 Jul, 2025 Reviewers agreed at journal 27 Jul, 2025 Reviewers agreed at journal 22 Jul, 2025 Reviewers invited by journal 22 Jul, 2025 Editor invited by journal 17 Jul, 2025 Editor assigned by journal 14 Jul, 2025 Submission checks completed at journal 14 Jul, 2025 First submitted to journal 04 Jul, 2025 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7045623","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":489164470,"identity":"e1911fa8-cad4-4b20-849a-4ca550409a9e","order_by":0,"name":"Subrina Ahmed Shanta","email":"","orcid":"","institution":"Pabna University of Science and Technology Pabna","correspondingAuthor":false,"prefix":"","firstName":"Subrina","middleName":"Ahmed","lastName":"Shanta","suffix":""},{"id":489164471,"identity":"830d21ba-5ba9-4d42-a7b1-0b8e387a1295","order_by":1,"name":"Md Shohidul Islam","email":"","orcid":"","institution":"Pabna University of Science and Technology Pabna","correspondingAuthor":false,"prefix":"","firstName":"Md","middleName":"Shohidul","lastName":"Islam","suffix":""},{"id":489164472,"identity":"853950dd-f128-4061-8c61-40d14de9a68d","order_by":2,"name":"Bikash Chandra Ghosh","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA5UlEQVRIiWNgGAWjYBACA2Y2BgbGBiCLvQEmxsMgQZwWngNAIoEYLQwwLRIJRGoxZ2dL/Phzh408v+TbY5I/fzDI8zfwHryBT4tlM9thad4zaYYzZ+elSfMkMBjOOMCXbIHXYYfZG6QZ2w4nGNzOMZMGOoxxAwOPGX6/HGZv/vmz7X+Cwc0zZpI/EhjsidDCdkyCt+1AgsENoEqgwxIJagH6Jc2aty3ZcGZPXrI1T5pE8ozDBPxizn/M+ObPNjt5fvazB2/+sLGx7W/vxR9iSIAHRACdxEykepiWUTAKRsEoGAWYAABoG0FWOk+fFAAAAABJRU5ErkJggg==","orcid":"","institution":"Pabna University of Science and Technology Pabna","correspondingAuthor":true,"prefix":"","firstName":"Bikash","middleName":"Chandra","lastName":"Ghosh","suffix":""}],"badges":[],"createdAt":"2025-07-04 10:08:37","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-7045623/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7045623/v1","draftVersion":[],"editorialEvents":[{"content":"https://doi.org/10.1007/s43621-025-02412-1","type":"published","date":"2025-12-04T15:58:27+00:00"}],"editorialNote":"","failedWorkflow":false,"files":[{"id":97724005,"identity":"775dcaf8-e833-4855-abf1-7bf686c94f9c","added_by":"auto","created_at":"2025-12-08 16:10:48","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":927480,"visible":true,"origin":"","legend":"","description":"","filename":"FinalDIscoversustainability.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7045623/v1_covered_b4cf120a-7eb4-4809-a35a-2d05ad0bfcf1.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Bridging the Climate Finance Gap: Adaptive Capacity and Vulnerability of Smallholder Farmers’ in the Drought-Prone Northwest Region of Bangladesh","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":false,"highlight":"","institution":"","isAcceptedByJournal":true,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"discover-sustainability","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"disu","sideBox":"Learn more about [Discover Sustainability](https://www.springer.com/43621)","snPcode":"","submissionUrl":"","title":"Discover Sustainability","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Discover Series","inReviewEnabled":true,"inReviewRevisionsEnabled":true},"keywords":"Climate induced drought, Financial barriers, Stochastic Frontier Model (SFM) Analysis, Harrod-Domar Growth Model, Farmers Vulnerability Index, Bangladesh","lastPublishedDoi":"10.21203/rs.3.rs-7045623/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7045623/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003e\u003cem\u003eThe threat of climate change-induced drought poses a serious challenge to Bangladesh's smallholders, and despite the effectiveness of the adaptation measures, financial barriers often hinder their adoption—a factor frequently overlooked in existing studies. This study addresses that gap by investigating the nexus between farmers' financial situation and their production, vulnerability, and the effectiveness of various adaptation strategies. Using cross-section data from 300 farm households across two climate-affected districts of northwestern Bangladesh, the study employs a two-step Stochastic Frontier Model (SFM) analysis to evaluate the nexus between rice productivity and climate adaptation strategies. To further explore the financial barriers to adaptive capacity, the Harrod-Domar growth equation and Multivariate Probit (MVP) regression were utilized. Moreover, the Foster-Greer-Thorbecke (FGT) index was applied to assess farmers' vulnerability to climate change. Results from the two-step SFM reveal that the use of seedlings and expansion of farm size significantly enhance productivity. The Harrod-Domar growth equation reveals an average finance gap of $190 per bigha, with 93% of farmers requiring $300 or less to enhance efficiency. Moreover, the MVP regression shows that reducing the financial gap substantially increases the likelihood of adopting water harvesting (81.89%) and drought-tolerant crops (77.25%), both of which contribute to higher productivity. Finally, FGT analysis reveals that 87% of farmers are vulnerable to climate impacts; however, providing just $90 per farmer could notably reduce this vulnerability. The results highlight the crucial importance of focused financial assistance in enhancing resilience. Therefore, government agencies and NGOs should prioritize the provision of appropriate loans, financial assistance, advanced irrigation technology, and agricultural extension services to empower smallholder farmers to optimize productivity and meet production targets.\u003c/em\u003e\u003c/p\u003e","manuscriptTitle":"Bridging the Climate Finance Gap: Adaptive Capacity and Vulnerability of Smallholder Farmers’ in the Drought-Prone Northwest Region of Bangladesh","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-07-24 10:43:02","doi":"10.21203/rs.3.rs-7045623/v1","editorialEvents":[{"type":"communityComments","content":0},{"type":"decision","content":"Revision requested","date":"2025-09-03T06:40:34+00:00","index":"","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-08-11T18:05:39+00:00","index":"hide","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-08-11T04:48:52+00:00","index":"hide","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-08-09T05:30:14+00:00","index":"hide","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2025-08-07T20:04:13+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"19896488169018658938377331069920476265","date":"2025-07-31T06:24:01+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"265226237589377159009092136887133129777","date":"2025-07-30T15:47:36+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"205841971960473288774365302108221592394","date":"2025-07-30T07:15:24+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"163492718928172072892222885822373041692","date":"2025-07-30T06:38:51+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"331880224951054035102749657860617912904","date":"2025-07-30T06:24:29+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"330087937843200555885676793862185410335","date":"2025-07-29T05:27:48+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"23367197473103318269512143598935669191","date":"2025-07-27T11:46:21+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"233025007900810034013282108179486626895","date":"2025-07-22T11:14:15+00:00","index":"hide","fulltext":""},{"type":"reviewersInvited","content":"","date":"2025-07-22T10:27:26+00:00","index":"","fulltext":""},{"type":"editorInvited","content":"","date":"2025-07-17T06:31:06+00:00","index":"","fulltext":""},{"type":"editorAssigned","content":"","date":"2025-07-14T11:35:39+00:00","index":"","fulltext":""},{"type":"checksComplete","content":"","date":"2025-07-14T11:34:42+00:00","index":"","fulltext":""},{"type":"submitted","content":"Discover Sustainability","date":"2025-07-04T10:06:46+00:00","index":"","fulltext":""}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"discover-sustainability","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"disu","sideBox":"Learn more about [Discover Sustainability](https://www.springer.com/43621)","snPcode":"","submissionUrl":"","title":"Discover Sustainability","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Discover Series","inReviewEnabled":true,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"e85fa4c8-d16e-467a-ba01-9055da53b85d","owner":[],"postedDate":"July 24th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"published-in-journal","subjectAreas":[],"tags":[],"updatedAt":"2025-12-08T16:04:51+00:00","versionOfRecord":{"articleIdentity":"rs-7045623","link":"https://doi.org/10.1007/s43621-025-02412-1","journal":{"identity":"discover-sustainability","isVorOnly":false,"title":"Discover Sustainability"},"publishedOn":"2025-12-04 15:58:27","publishedOnDateReadable":"December 4th, 2025"},"versionCreatedAt":"2025-07-24 10:43:02","video":"","vorDoi":"10.1007/s43621-025-02412-1","vorDoiUrl":"https://doi.org/10.1007/s43621-025-02412-1","workflowStages":[]},"version":"v1","identity":"rs-7045623","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7045623","identity":"rs-7045623","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}