Indexing the soil 27
economic objects, ‘risks.’ As weather-related catastrophes are analysed in
terms of precise monetary values, the risks involved can be treated on the
same objectified level as that of all kinds of other financial instruments. In
other words, as risks that are related to agricultural practices and the caring
for soil, they become comparable to all other financial cost–benefit analyses
and turn into entities that can be traded in international markets and that
financial actors can invest in. This chapter considers how the instrument
works as part of a programme that connects local economies to external
resources, representing a systematic strategy to integrate the soil into the
coordination of global financial markets.
Third, the work on the two previous themes has led us to a surprising
finding as regards the contents of RM: although index insurance is much
advertised by the World Bank and GIIF as an efficient tool for engaging
with financialised climate change mitigation, in RM, a lengthy document of
more than 300 pages, the term of ‘climate change’ occurs only once; moreover, as will be detailed below, the instrument is not intended to take into
account risks that change, thus effectively precluding from its scope of intervention the very idea of climate change. Thus, the instrument is revealed to
be a means of objectifying weather-related risks as something that the financial infrastructure can intervene in and profit from, even if the high hopes of
‘climate change mitigation’ are completely sidestepped.
While examining these themes, we obviously rely on the recent social
scientific literature on weather-related insurance technologies and reinsurance. As we focus on a tool developed under the auspices of the World Bank,
our research draws especially on the work of Leigh Johnson and colleagues
(Johnson 2013; Johnson et al. 2019). In a recent article, she describes 15 years
of index insurance development and experimentation that has sought to
expand insurance coverage to the poorest regions of the world in order to
build resilience against climate change risks (Johnson 2021). The chronicling
of multiple programmes reveals a largely failed project that is suffering from
both low demand and significant problems in product design. Analysing
institutional composition, governmental goal articulation, and strategies for
correcting the instruments’ apparent flaws, Johnson identifies a change in the
development of index insurance products, which are shifting from microfinance towards meso- and macro-level instruments. Her analysis underscores
the political economy of climate risk management. Index insurance products
are designed for areas where weak institutional capabilities make preparing
for climate change-caused shocks difficult. Therefore, even an unreliable risk
technology can be received with enthusiasm in regions defined by their vulnerable position in the global economy (see also Grove 2021).
In contrast to Johnson’s synthesising interpretations of the uses of index
insurance in developing contexts, in this text we concentrate on analysing
the design of the instrument, as represented in the core document RM. In
doing so, our aim is to tease out the technological underpinnings of the
index insurance endeavour. We want to dig deeply into understanding how
economic objects, ‘risks.’ As weather-related catastrophes are analysed in
terms of precise monetary values, the risks involved can be treated on the
same objectified level as that of all kinds of other financial instruments. In
other words, as risks that are related to agricultural practices and the caring
for soil, they become comparable to all other financial cost–benefit analyses
and turn into entities that can be traded in international markets and that
financial actors can invest in. This chapter considers how the instrument
works as part of a programme that connects local economies to external
resources, representing a systematic strategy to integrate the soil into the
coordination of global financial markets.
Third, the work on the two previous themes has led us to a surprising
finding as regards the contents of RM: although index insurance is much
advertised by the World Bank and GIIF as an efficient tool for engaging
with financialised climate change mitigation, in RM, a lengthy document of
more than 300 pages, the term of ‘climate change’ occurs only once; moreover, as will be detailed below, the instrument is not intended to take into
account risks that change, thus effectively precluding from its scope of intervention the very idea of climate change. Thus, the instrument is revealed to
be a means of objectifying weather-related risks as something that the financial infrastructure can intervene in and profit from, even if the high hopes of
‘climate change mitigation’ are completely sidestepped.
While examining these themes, we obviously rely on the recent social
scientific literature on weather-related insurance technologies and reinsurance. As we focus on a tool developed under the auspices of the World Bank,
our research draws especially on the work of Leigh Johnson and colleagues
(Johnson 2013; Johnson et al. 2019). In a recent article, she describes 15 years
of index insurance development and experimentation that has sought to
expand insurance coverage to the poorest regions of the world in order to
build resilience against climate change risks (Johnson 2021). The chronicling
of multiple programmes reveals a largely failed project that is suffering from
both low demand and significant problems in product design. Analysing
institutional composition, governmental goal articulation, and strategies for
correcting the instruments’ apparent flaws, Johnson identifies a change in the
development of index insurance products, which are shifting from microfinance towards meso- and macro-level instruments. Her analysis underscores
the political economy of climate risk management. Index insurance products
are designed for areas where weak institutional capabilities make preparing
for climate change-caused shocks difficult. Therefore, even an unreliable risk
technology can be received with enthusiasm in regions defined by their vulnerable position in the global economy (see also Grove 2021).
In contrast to Johnson’s synthesising interpretations of the uses of index
insurance in developing contexts, in this text we concentrate on analysing
the design of the instrument, as represented in the core document RM. In
doing so, our aim is to tease out the technological underpinnings of the
index insurance endeavour. We want to dig deeply into understanding how