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Estimating the impact of climate change on agricultural production: Accounting for technology heterogeneity across countries

Author

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  • Exenberger, Andreas
  • Pondorfer, Andreas
  • Wolters, Maik H.
Abstract
We estimate the impact of climate change on agricultural production in a panel of 127 countries from 1961 to 2002. In contrast to the existing literature we account for cross-sectional dependence and technology heterogeneity. We find no significant impact of climate change on agricultural production in high income countries, but significant adverse effects in middle and low income countries. These adverse effects include a moderate negative impact of increases in temperature on agricultural output and for low income countries also negative effects of reductions in precipitation and of increases in the frequency of droughts. The latter two effects are particularly strong in Sub-Sahara Africa where low-tech rain-fed agriculture with very limited climate change adjustment capacities dominates. Thus, our findings reinforce the importance of proper adaptation strategies to climate change considering heterogeneous production technologies across countries.

Suggested Citation

  • Exenberger, Andreas & Pondorfer, Andreas & Wolters, Maik H., 2014. "Estimating the impact of climate change on agricultural production: Accounting for technology heterogeneity across countries," Kiel Working Papers 1920, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:1920
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    Cited by:

    1. Obindah Gershon & Chinua Mbajekwe, 2020. "Investigating the Nexus of Climate Change and Agricultural Production in Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 10(6), pages 1-8.
    2. Kabanda Richard & Peter W. Muriu & Benjamin Maturu, 2018. "Relative Effectiveness of Monetary and Fiscal Policies on Output Stabilization in Developing Countries: Evidence from Rwanda," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(1), pages 220-232, January.
    3. Kelvin Mulungu & Gelson Tembo & Hilary Bett & Hambulo Ngoma, 2021. "Climate change and crop yields in Zambia: historical effects and future projections," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(8), pages 11859-11880, August.
    4. Geoffrey Norman Tumwine & Razack B Lokina & John Mary Matovu, 2019. "The Effect of Climate Change on Agricultural Crop Returns in Uganda," Journal of Economics and Behavioral Studies, AMH International, vol. 11(4), pages 71-87.

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    More about this item

    Keywords

    agricultural production; climate change; panel data; cross-sectional dependence; parameter heterogeneity; common correlated effects estimator;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • N50 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - General, International, or Comparative
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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