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Climate Change And Crop Yield Distribution: Some New Evidence From Panel Data Models And Implications For Crop Insurance

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  • Chang, Ching-Cheng
  • Chen, Chi-Chung
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    Abstract

    This study examines the impact of climate on yield for seven major crops in Taiwan based on a pooled panel data of 15 counties over the period 1977-1996. Unit-root tests and maximum likelihood methods are explored to obtain reliable estimates. Results suggest that climate has diversified impacts on crop yields and their variability. A simple crop insurance model by Ahsan, Ali, and Kurian (1982) is shown how crop yield distribution can be the base to calculate the premium and indemnity.

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    File URL: http://purl.umn.edu/19589
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    Bibliographic Info

    Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2002 Annual meeting, July 28-31, Long Beach, CA with number 19589.

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    Date of creation: 2002
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    Handle: RePEc:ags:aaea02:19589

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    Keywords: Crop Production/Industries; Environmental Economics and Policy; Risk and Uncertainty;

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    1. Mendelsohn, Robert & Nordhaus, William D & Shaw, Daigee, 1994. "The Impact of Global Warming on Agriculture: A Ricardian Analysis," American Economic Review, American Economic Association, vol. 84(4), pages 753-71, September.
    2. Richard E. Just & Quinn Weninger, 1999. "Are Crop Yields Normally Distributed?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(2), pages 287-304.
    3. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-72, June.
    4. Chang, Ching-Cheng, 2002. "The potential impact of climate change on Taiwan's agriculture," Agricultural Economics, Blackwell, vol. 27(1), pages 51-64, May.
    5. Arellano, Manuel, 1993. "On the testing of correlated effects with panel data," Journal of Econometrics, Elsevier, vol. 59(1-2), pages 87-97, September.
    6. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
    7. Robert K. Kaufmann & Seth E. Snell, 1997. "A Biophysical Model of Corn Yield: Integrating Climatic and Social Determinants," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 178-190.
    8. Baltagi, Badi H. & Li, Qi, 1995. "Testing AR(1) against MA(1) disturbances in an error component model," Journal of Econometrics, Elsevier, vol. 68(1), pages 133-151, July.
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