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Irrigation, Adaptation and Climate Change: Panel Data Evidence for Maize in Mexico

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  • Arellano Gonzalez Jesus

Abstract

In this paper, I use an 18-year long panel data set of maize yields and high resolution weather data at the municipality level in Mexico to shed light on the differentiated effects that climate change may have in rainfed and irrigated agriculture. I find that rainfed maize is sensitive to both temperature and precipitation. This sensitivity is weakened in irrigated maize suggesting that the use of irrigation reduces not only the dependency of production on direct precipitation but also the damaging effects of warmer temperatures. When the panel estimates are applied to climate change projections for 2100 I conclude that, in the absence of adaptation, rainfed maize yields could decrease by 3.3-4.0% on average depending on the climate model and scenario with rising temperatures accounting for about 80% of the loss and a declining precipitation accounting for the remaining 20%. Areas with high levels of rural poverty could be among the most affected with some municipalities losing up to 13.5% of maize yields.

Suggested Citation

  • Arellano Gonzalez Jesus, 2023. "Irrigation, Adaptation and Climate Change: Panel Data Evidence for Maize in Mexico," Working Papers 2023-05, Banco de México.
  • Handle: RePEc:bdm:wpaper:2023-05
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    File URL: https://www.banxico.org.mx/publications-and-press/banco-de-mexico-working-papers/%7B502E4DB0-CF84-A4BA-1D0D-559A3EB4DCCE%7D.pdf
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    References listed on IDEAS

    as
    1. Arslan, Aslihan & Taylor, J.Edward, 2009. "Farmers' Subjective Valuation of Subsistence Crops: The Case of Traditional Maize in Mexico," American Journal of Agricultural Economics APPENDICES, Agricultural and Applied Economics Association, vol. 91(4), pages 1-4, April.
    2. Marshall Burke & Kyle Emerick, 2016. "Adaptation to Climate Change: Evidence from US Agriculture," American Economic Journal: Economic Policy, American Economic Association, vol. 8(3), pages 106-140, August.
    3. Elodie Blanc & Wolfram Schlenker, 2017. "The Use of Panel Models in Assessments of Climate Impacts on Agriculture," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 11(2), pages 258-279.
    4. Marshall Burke & Melanie Craxton & Charles D. Kolstad & Chikara Onda, 2016. "Some Research Challenges In The Economics Of Climate Change," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 7(02), pages 1-14, May.
    5. Maximilian Auffhammer, 2018. "Climate Adaptive Response Estimation: Short And Long Run Impacts Of Climate Change On Residential Electricity and Natural Gas Consumption Using Big Data," NBER Working Papers 24397, National Bureau of Economic Research, Inc.
    6. Jessica Bravo-Cadena & Numa P. Pavón & Patricia Balvanera & Gerardo Sánchez-Rojas & Ramón Razo-Zarate, 2021. "Water Availability–Demand Balance under Climate Change Scenarios in an Overpopulated Region of Mexico," IJERPH, MDPI, vol. 18(4), pages 1-16, February.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Climate Change; Adaptation; Irrigation; Agriculture; Panel Data;
    All these keywords.

    JEL classification:

    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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