Rainfall Forecasts, Weather and Wages over the Agricultural Production Cycle
AbstractWe look at the effects of rainfall forecasts and realized rainfall on equilibrium agricultural wages over the course of the agricultural production cycle. We show theoretically that a forecast of good weather can lower wages in the planting stage, by lowering ex ante out-migration, and can exacerbate the negative impact of adverse weather on harvest-stage wages. Using Indian household panel data describing early-season migration and district-level planting- and harvest-stage wages over the period 2005-2010, we find results consistent with the model, indicating that rainfall forecasts improve labor allocations on average but exacerbate wage volatility because they are imperfect.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19808.
Date of creation: Jan 2014
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Other versions of this item:
- Mark Rosenzweig & Christopher Udry, 2014. "Rainfall Forecasts, Weather and Wages over the Agricultural Production Cycle," Working Papers 1036, Economic Growth Center, Yale University.
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
This paper has been announced in the following NEP Reports:
- NEP-AGR-2014-01-24 (Agricultural Economics)
- NEP-ALL-2014-01-24 (All new papers)
- NEP-FOR-2014-01-24 (Forecasting)
- NEP-LMA-2014-01-24 (Labor Markets - Supply, Demand, & Wages)
- NEP-MIG-2014-01-24 (Economics of Human Migration)
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