Agriculture and environmental change, especially climate change: economic challenges

This chapter initially examines general relationships between agricultural activity and environmental change and the level of economic welfare. It then provides a brief account of the historical development of agriculture, focusing on its environmental and socio-economic consequences. The pivotal role of the commencement and evolution of agriculture in economic development is stressed. It is only as a result of agriculture that the current level of the world’s population can be sustained. For a considerable amount of time, the world’s population has exceeded that which can be sustained by hunting and gathering. A major challenge which agriculture faces in this century is how to increase its production to meet increasing demands for food due to global population growth and rising incomes, and how it can achieve this without causing significant environmental deterioration. Can this be achieved by sustainable agricultural intensification? This is one of the issues discussed. The likely impacts on the level of agricultural production of climate change and the adjustment issues facing agriculture as a result of climate change are major contemporary concerns. The modelling of these aspects is reviewed and some different perspectives are provided compared to those in the literature, for example, the perspective presented by Mendelsohn and Dinar. The desirability of different types of public policies for responding to the effects of climate change on agriculture is also discussed.