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A Cost of Tractability? Estimating Climate Change Impacts Using a Single Crop Market Understates Impacts on Market Conditions and Variability

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Listed:
  • Wyatt Thompson
  • Scott Gerlt
  • J. Elliott Campbell
  • Lara M. Kueppers
  • Yaqiong Lu
  • Mark A. Snyder

Abstract

Scientists estimate that U.S. Corn Belt crop yields will increase or decrease, on average, and become more variable with climate change. Corn and soybean farming dominates this region, but studies typically do not assess the joint impact of new distributions of corn and soybean yields on markets. We use a structural economic model with projections of climate-driven yield changes to simulate these effects. Our findings suggest that a narrow focus on a single crop in this key growing region risks underestimating the impact on price distributions and average crop receipts, and can lead to incorrect signs on estimated impacts.

Suggested Citation

  • Wyatt Thompson & Scott Gerlt & J. Elliott Campbell & Lara M. Kueppers & Yaqiong Lu & Mark A. Snyder, 2017. "A Cost of Tractability? Estimating Climate Change Impacts Using a Single Crop Market Understates Impacts on Market Conditions and Variability," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 39(2), pages 346-362.
    • Handle: RePEc:oup:apecpp:v:39:y:2017:i:2:p:346-362.
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    File URL: http://hdl.handle.net/10.1093/aepp/ppw023
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    References listed on IDEAS

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    1. Westhoff, Patrick C. & Brown, Scott & Hart, Chad E., 2006. "When Point Estimates Miss the Point: Stochastic Modeling of WTO Restrictions," Staff General Research Papers Archive 31341, Iowa State University, Department of Economics.
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    Cited by:

    1. Thompson, Wyatt & Gerlt, Scott & Dewbre, Joe H. & Effland, Anne B., 2020. "Rescuing the Decoupling Literature from Incomparable Chaos," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304366, Agricultural and Applied Economics Association.
    2. Miguel Carriquiry & Amani Elobeid & Jerome Dumortier & Ryan Goodrich, 2020. "Incorporating Sub‐National Brazilian Agricultural Production and Land‐Use into U.S. Biofuel Policy Evaluation," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(3), pages 497-523, September.
    3. Thompson, Wyatt & Lu, Yaqiong & Gerlt, Scott & Yang, Xianyu & Campbell, J. Elliott & Kueppers, Lara M. & Snyder, Mark A., 2018. "Automatic Responses of Crop Stocks and Policies Buffer Climate Change Effects on Crop Markets and Price Volatility," Ecological Economics, Elsevier, vol. 152(C), pages 98-105.

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    More about this item

    Keywords

    climate change adaptation; NARCCAP; Corn Belt yields; statistical yield model;
    All these keywords.

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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