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The Impact of Typhoons on Agricultural Productivity—Evidence from Coastal Regions of China

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  • Ren, Weicong

Abstract

The impact of natural disasters on agricultural production has garnered global attention. This study takes typhoons as an example, employing their movement paths to construct a difference-in-differences (DID) model and combining survey data from Rural Fixed Observation Spots to estimate changes in agricultural productivity from coastal regions of China, including Guangdong, Fujian, and Zhejiang provinces. This study finds that typhoons significantly deteriorate local agricultural productivity. Specifically, the planting income per mu and planting income per capita of rural households have decreased by 11% and 14%, respectively, while agricultural total factor productivity (TFP) has dropped by 3.7%. The decline in productivity can be attributed to two channels. Firstly, typhoons directly damage crops, leading to reduced total output. Secondly, in anticipation of typhoons, rural households increase asset input but reduce labor input and intermediate goods, resulting in the misallocation of agricultural inputs, which further diminishes productivity. The cost-benefit analysis indicates that to compensate for 20% of the negative impact of typhoons on agricultural productivity, local financial funds ranging from 3.4 million to 20 million yuan are required. Therefore, it is imperative for the Chinese government to strengthen the natural disaster warning system and improve farmland water conservancy infrastructure to mitigate the misallocation of agricultural inputs by rural households.

Suggested Citation

  • Ren, Weicong, 2024. "The Impact of Typhoons on Agricultural Productivity—Evidence from Coastal Regions of China," Agricultural & Rural Studies (A&R), Zhejiang A&F University, vol. 2(4), December.
    • Handle: RePEc:ags:aesars:410163
    DOI: 10.22004/ag.econ.410163
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