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A Ricardian analysis of the impact of climate change on Latin American farms

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  • Seo, Niggol
  • Mendelsohn, Robert

Abstract

This study estimates the vulnerability of Latin American agriculture to climate change using a Ricardian analysis of both land values and net revenues. Examining a sample of over 2,500 farms in seven countries, the results indicate both land value and net revenue are sensitive to climate. Both small farms and large farms have a hill-shaped relationship with temperature. Estimating separate regressions for dryland and irrigated farms reveals that dryland farms are more sensitive to temperature but irrigated farms are more sensitive to precipitation. Examining the effects from future climate change scenarios reveals thatsevere scenarios could reduce farm earnings by as much as 62 percent by 2100, whereas more moderate scenarios could reduce earnings by about 15 percent. Small and large farms are equally sensitive to global warming. Land value and net revenue analyses produce quite similar results.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4163.

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Date of creation: 01 Mar 2007
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Handle: RePEc:wbk:wbrwps:4163

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Keywords: Climate Change; Rural Development Knowledge&Information Systems; Agriculture&Farming Systems; Crops&Crop Management Systems; Common Property Resource Development;

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References

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  1. Mendelsohn, Robert & Dinar, Ariel & Sanghi, Apurva, 2001. "The effect of development on the climate sensitivity of agriculture," Environment and Development Economics, Cambridge University Press, vol. 6(01), pages 85-101, February.
  2. Seo, Sung-No Niggol & Mendelsohn, Robert & Munasinghe, Mohan, 2005. "Climate change and agriculture in Sri Lanka: a Ricardian valuation," Environment and Development Economics, Cambridge University Press, vol. 10(05), pages 581-596, October.
  3. Dinar, A. & Mendelsohn, R. & Evenson, R. & Parikh, J. & Sanghi, A. & Kumar, K. & McKinsey, J. & Lonergen, S., 1998. "Measuring the Impact of CLimate Change on Indian Agriculture," Papers 402, World Bank - Technical Papers.
  4. Kelly, David L. & Kolstad, Charles D. & Mitchell, Glenn T., 2005. "Adjustment costs from environmental change," Journal of Environmental Economics and Management, Elsevier, vol. 50(3), pages 468-495, November.
  5. Jinxia Wang & Robert Mendelsohn & Ariel Dinar & Jikun Huang & Scott Rozelle & Lijuan Zhang, 2009. "The impact of climate change on China's agriculture," Agricultural Economics, International Association of Agricultural Economists, vol. 40(3), pages 323-337, 05.
  6. Mendelsohn, Robert & Nordhaus, William, 1996. "The Impact of Global Warming on Agriculture: Reply," American Economic Review, American Economic Association, vol. 86(5), pages 1312-15, December.
  7. 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.
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Citations

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Cited by:
  1. S. Seo & Robert Mendelsohn & Ariel Dinar & Rashid Hassan & Pradeep Kurukulasuriya, 2009. "A Ricardian Analysis of the Distribution of Climate Change Impacts on Agriculture across Agro-Ecological Zones in Africa," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 43(3), pages 313-332, July.
  2. Seo, S. Niggol & Mendelsohn, Robert, 2008. "An analysis of crop choice: Adapting to climate change in South American farms," Ecological Economics, Elsevier, vol. 67(1), pages 109-116, August.
  3. Kabubo-Mariara, Jane, 2009. "Global warming and livestock husbandry in Kenya: Impacts and adaptations," Ecological Economics, Elsevier, vol. 68(7), pages 1915-1924, May.
  4. Seo, Niggol & Mendelsohn, Robert & Dinar, Ariel & Kurukulasuriya, Pradeep & Hassan, Rashid, 2008. "Long-term adaptation : selecting farm types across agro-ecological zones in Africa," Policy Research Working Paper Series 4602, The World Bank.
  5. Wang, Jinxia & Mendelsohn, Robert & Dinar, Ariel & Huang, Jikun, 2008. "How China's farmers adapt to climate change," Policy Research Working Paper Series 4758, The World Bank.
  6. Wang, Jinxia & Mendelsohn, Robert & Dinar, Ariel & Huang, Jikun & Rozelle, Scott & Zhang, Lijuan, 2008. "Can China continue feeding itself ? the impact of climate change on agriculture," Policy Research Working Paper Series 4470, The World Bank.
  7. Seo, Niggol & Mendelsohn, Robert & Kurukulasuriya, Pradeep & Dinar, Ariel & Hassan, Rashid, 2008. "Differential adaptation strategies to climate change in African cropland by agro-ecological zones," Policy Research Working Paper Series 4600, The World Bank.

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