IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/332878.html
   My bibliography  Save this paper

Climate change adaptation, agriculture and poverty: A general equilibrium analysis for Nepal

Author

Listed:
  • Chalise, Sudarshan
  • Naranpanawa, Athula
  • Bandara, Jayatilleke

Abstract

This paper presents a model of climate change adaptation in the Nepalese economy and uses it to simulate long-run impacts of climate change and cropland re-allocation on household poverty. We develop a computable general equilibrium (CGE) model for Nepal, with a nested set of constant elasticity of transformation (CET) functional forms to model the allocation of land within different agricultural sectors. Supply of land depends on the magnitude of effects of climate change on different crops. Land transformation elasticities in the CET functions reflect the ease of switching from one crop to another based on their agronomic characteristics and degree of impacts of climate change. The distinguishing feature of the model is flexibility of CET values. Use of a set of CET values at the sectoral level thus captures the transformation effects of agronomic feasibility and profitability of crops while, at the same time, retaining the role of price relativity in the demand side of land along with other factors of production. The results suggest that, in the long run, farmers tend to allocate land to crops that are comparatively less impacted by climate change, such as paddy. Furthermore, the results reveal that land re-allocation tends to reduce income disparity among household groups and poverty by significantly moderating the income losses of marginal farmers.

Suggested Citation

  • Chalise, Sudarshan & Naranpanawa, Athula & Bandara, Jayatilleke, 2017. "Climate change adaptation, agriculture and poverty: A general equilibrium analysis for Nepal," Conference papers 332878, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332878
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/332878/files/8432.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Angel Aguiar & Badri Narayanan & Robert McDougall, 2016. "An Overview of the GTAP 9 Data Base," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 1(1), pages 181-208, June.
    2. Roman Keeney & Thomas W. Hertel, 2009. "The Indirect Land Use Impacts of United States Biofuel Policies: The Importance of Acreage, Yield, and Bilateral Trade Responses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 895-909.
    3. Eboli, Fabio & Parrado, Ramiro & Roson, Roberto, 2010. "Climate-change feedback on economic growth: explorations with a dynamic general equilibrium model," Environment and Development Economics, Cambridge University Press, vol. 15(5), pages 515-533, October.
    4. Maximilian Auffhammer & V. Ramanathan & Jeffrey Vincent, 2012. "Climate change, the monsoon, and rice yield in India," Climatic Change, Springer, vol. 111(2), pages 411-424, March.
    5. Christoph Müller & Richard D. Robertson, 2014. "Projecting future crop productivity for global economic modeling," Agricultural Economics, International Association of Agricultural Economists, vol. 45(1), pages 37-50, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sudarshan Chalise & Dr Athula Naranpanawa, 2016. "Climate change adaptation in agriculture: A general equilibrium analysis of land re-allocation in Nepal," EcoMod2016 9272, EcoMod.
    2. Sudarshan Chalise & Athula Naranpanawa, 2023. "Potential impacts of climate change and adaptation in agriculture on poverty: the case of Nepal," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 28(4), pages 1540-1559, October.
    3. Chalise, Sudarshan & Naranpanawa, Athula & Bandara, Jayatilleke S. & Sarker, Tapan, 2017. "A general equilibrium assessment of climate change–induced loss of agricultural productivity in Nepal," Economic Modelling, Elsevier, vol. 62(C), pages 43-50.
    4. Xin Zhao & Dominique Y van der Mensbrugghe & Roman M. Keeney & Wallace E. Tyner, 2021. "Improving the Way Land Use Change is Handled in Economic Models," World Scientific Book Chapters, in: Peter Dixon & Joseph Francois & Dominique van der Mensbrugghe (ed.), POLICY ANALYSIS AND MODELING OF THE GLOBAL ECONOMY A Festschrift Celebrating Thomas Hertel, chapter 15, pages 467-515, World Scientific Publishing Co. Pte. Ltd..
    5. Zhao, Xin & van der Mensbrugghe, Dominique & Tyner, Wally, 2017. "Modeling land physically in CGE models: new insights on intensive and extensive margins," Conference papers 332816, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    6. Tibor András Marton & Anna Kis & Anna Zubor-Nemes & Anikó Kern & Nándor Fodor, 2020. "Human Impact Promotes Sustainable Corn Production in Hungary," Sustainability, MDPI, vol. 12(17), pages 1-16, August.
    7. Li, Liang & Taheripour, Farzad & Preckel, Paul V. & Tyner, Wallace E., 2012. "Improvement of GTAP Cropland Constant Elasticity of Transformation Nesting Structure," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124704, Agricultural and Applied Economics Association.
    8. Zhao, Xin & Van Der Mensbrugghe, Dominique & Tyner, Wallace E., 2017. "Modeling land physically in CGE models: new insights on intensive and extensive margins," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258363, Agricultural and Applied Economics Association.
    9. Zheng, Shuxian & Zhou, Xuanru & Tan, Zhanglu & Liu, Chan & Hu, Han & Yuan, Hui & Peng, Shengnan & Cai, Xiaomei, 2023. "Assessment of the global energy transition: Based on trade embodied energy analysis," Energy, Elsevier, vol. 273(C).
    10. Knut Einar Rosendahl & Jon Strand, 2011. "Carbon Leakage from the Clean Development Mechanism," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 27-50.
    11. Tomoko Hasegawa & Shinichiro Fujimori & Petr Havlík & Hugo Valin & Benjamin Leon Bodirsky & Jonathan C. Doelman & Thomas Fellmann & Page Kyle & Jason F. L. Koopman & Hermann Lotze-Campen & Daniel Maso, 2018. "Risk of increased food insecurity under stringent global climate change mitigation policy," Nature Climate Change, Nature, vol. 8(8), pages 699-703, August.
    12. Roberto Roson & Richard Damania, the World Bank, Washington D.C., 2016. "Simulating the Macroeconomic Impact of Future Water Scarcity," EcoMod2016 9167, EcoMod.
    13. Winchester, Niven & Reilly, John M., 2020. "The economic and emissions benefits of engineered wood products in a low-carbon future," Energy Economics, Elsevier, vol. 85(C).
    14. Gabriel Bachner & Daniel Lincke & Jochen Hinkel, 2022. "The macroeconomic effects of adapting to high-end sea-level rise via protection and migration," Nature Communications, Nature, vol. 13(1), pages 1-13, December.
    15. Pothen, Frank & Hübler, Michael, 2021. "A forward calibration method for analyzing energy policy in new quantitative trade models," Energy Economics, Elsevier, vol. 100(C).
    16. María C. Latorre & Zoryana Olekseyuk & Hidemichi Yonezawa, 2020. "Foreign multinationals in service sectors: A general equilibrium analysis of Brexit," The World Economy, Wiley Blackwell, vol. 43(11), pages 2830-2859, November.
    17. Jeetendra Prakash Aryal & Tek B. Sapkota & Ritika Khurana & Arun Khatri-Chhetri & Dil Bahadur Rahut & M. L. Jat, 2020. "Climate change and agriculture in South Asia: adaptation options in smallholder production systems," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(6), pages 5045-5075, August.
    18. Rada, Nicholas E. & Rosen, Stacey & Beckman, Jayson F., 2013. "Evaluating Agricultural Productivity’s Impact on Food Security," 2013: Productivity and Its Impacts on Global Trade, June 2-4, 2013. Seville, Spain 152265, International Agricultural Trade Research Consortium.
    19. Jayatilleke S. Bandara & Yiyong Cai, 2014. "The impact of climate change on food crop productivity, food prices and food security in South Asia," Economic Analysis and Policy, Elsevier, vol. 44(4), pages 451-465.
    20. Théo Benonnier & Katrin Millock & Vis Taraz, 2022. "Long-term migration trends and rising temperatures: the role of irrigation," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 11(3), pages 307-330, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:pugtwp:332878. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.