The impact of climate and land use change on agriculture in EU28: A computable general equilibrium analysis

This paper assesses the macroeconomic implications of climate and land use change on agriculture in the European Union, by means of a computable general equilibrium model of the world economy. The counterfactual simulations are conducted at the year 2050 under a Shared Socioeconomic Pathway (SSP2). We use the SSP input data on predicted population and income levels to obtain a plausible baseline of the whole economy at the year 2050. Percentage changes of GDP and population are applied to the corresponding variable in the CGE model, so that the model generates a counterfactual baseline scenario, where the level of other macroeconomic variables is consistent with the projected population and income. The 2050 SSP baseline is then shocked to account for the climate change impact on agricultural productivity and the variations in land available for agriculture. The research is still a work in progress. Some preliminary results are already presented in the paper, some others will be added. They seem to suggest that (i) most countries will be negatively affected by both climate change and land use change, whereas a minority (especially northern economies) will benefit; (ii) the impacts may generate opposite effects depending on the crop under investigation.