IDEAS home Printed from https://ideas.repec.org/p/arx/papers/1902.09204.html
   My bibliography  Save this paper

Climate Change and Agriculture: Subsistence Farmers' Response to Extreme Heat

Author

Listed:
  • Fernando M. Arag'on

    (Department of Economics, Simon Fraser University)

  • Francisco Oteiza

    (Department of Social Science, UCL Institute of Education)

  • Juan Pablo Rud

    (Department of Economics, Royal Holloway, University of London and Institute of Fiscal Studies)

Abstract

This paper examines how subsistence farmers respond to extreme heat. Using micro-data from Peruvian households, we find that high temperatures reduce agricultural productivity, increase area planted, and change crop mix. These findings are consistent with farmers using input adjustments as a short-term mechanism to attenuate the effect of extreme heat on output. This response seems to complement other coping strategies, such as selling livestock, but exacerbates the drop in yields, a standard measure of agricultural productivity. Using our estimates, we show that accounting for land adjustments is important to quantify damages associated with climate change.

Suggested Citation

  • Fernando M. Arag'on & Francisco Oteiza & Juan Pablo Rud, 2019. "Climate Change and Agriculture: Subsistence Farmers' Response to Extreme Heat," Papers 1902.09204, arXiv.org, revised Feb 2019.
    • Handle: RePEc:arx:papers:1902.09204
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/1902.09204
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Zhang, Peng & Deschenes, Olivier & Meng, Kyle & Zhang, Junjie, 2018. "Temperature effects on productivity and factor reallocation: Evidence from a half million chinese manufacturing plants," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 1-17.
    2. Chen, Shuai & Chen, Xiaoguang & Xu, Jintao, 2016. "Impacts of climate change on agriculture: Evidence from China," Journal of Environmental Economics and Management, Elsevier, vol. 76(C), pages 105-124.
    3. de Janvry, Alain & Fafchamps, M. & Sadoulet, Elisabeth, 1991. "Peasant Household Behavior with Missing Markets: Some Paradoxes Explain," CUDARE Working Papers 198579, University of California, Berkeley, Department of Agricultural and Resource Economics.
    4. Markus Goldstein & Christopher Udry, 2008. "The Profits of Power: Land Rights and Agricultural Investment in Ghana," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 981-1022, December.
    5. Marshall Burke & Solomon M. Hsiang & Edward Miguel, 2015. "Global non-linear effect of temperature on economic production," Nature, Nature, vol. 527(7577), pages 235-239, November.
    6. Restuccia, Diego & Yang, Dennis Tao & Zhu, Xiaodong, 2008. "Agriculture and aggregate productivity: A quantitative cross-country analysis," Journal of Monetary Economics, Elsevier, vol. 55(2), pages 234-250, March.
    7. Rosenzweig, Mark R & Wolpin, Kenneth I, 1993. "Credit Market Constraints, Consumption Smoothing, and the Accumulation of Durable Production Assets in Low-Income Countries: Investment in Bullocks in India," Journal of Political Economy, University of Chicago Press, vol. 101(2), pages 223-244, April.
    8. Jonathan Colmer, 2021. "Temperature, Labor Reallocation, and Industrial Production: Evidence from India," American Economic Journal: Applied Economics, American Economic Association, vol. 13(4), pages 101-124, October.
    9. Melissa Dell & Benjamin F. Jones & Benjamin A. Olken, 2014. "What Do We Learn from the Weather? The New Climate-Economy Literature," Journal of Economic Literature, American Economic Association, vol. 52(3), pages 740-798, September.
    10. Shuaizhang Feng & Michael Oppenheimer & Wolfram Schlenker, 2012. "Climate Change, Crop Yields, and Internal Migration in the United States," NBER Working Papers 17734, National Bureau of Economic Research, Inc.
    11. Arnaud Costinot & Dave Donaldson & Cory Smith, 2016. "Evolving Comparative Advantage and the Impact of Climate Change in Agricultural Markets: Evidence from 1.7 Million Fields around the World," Journal of Political Economy, University of Chicago Press, vol. 124(1), pages 205-248.
    12. Salvatore Di Falco & Marcella Veronesi & Mahmud Yesuf, 2011. "Does Adaptation to Climate Change Provide Food Security? A Micro-Perspective from Ethiopia," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(3), pages 825-842.
    13. Kaivan Munshi, 2003. "Networks in the Modern Economy: Mexican Migrants in the U. S. Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(2), pages 549-599.
    14. J. Taylor & Irma Adelman, 2003. "Agricultural Household Models: Genesis, Evolution, and Extensions," Review of Economics of the Household, Springer, vol. 1(1), pages 33-58, January.
    15. Benjamin, Dwayne, 1992. "Household Composition, Labor Markets, and Labor Demand: Testing for Separation in Agricultural Household Models," Econometrica, Econometric Society, vol. 60(2), pages 287-322, March.
    16. Auffhammer, Maximilian & Schlenker, Wolfram, 2014. "Empirical studies on agricultural impacts and adaptation," Energy Economics, Elsevier, vol. 46(C), pages 555-561.
    17. Zhang, Peng & Zhang, Junjie & Chen, Minpeng, 2017. "Economic impacts of climate change on agriculture: The importance of additional climatic variables other than temperature and precipitation," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 8-31.
    18. Douglas Gollin & David Lagakos & Michael E. Waugh, 2014. "The Agricultural Productivity Gap," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(2), pages 939-993.
    19. Anjini Kochar, 1999. "Smoothing Consumption by Smoothing Income: Hours-of-Work Responses to Idiosyncratic Agricultural Shocks in Rural India," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 50-61, February.
    20. 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.
    21. Bandara, Amarakoon & Dehejia, Rajeev & Lavie-Rouse, Shaheen, 2015. "The Impact of Income and Non-Income Shocks on Child Labor: Evidence from a Panel Survey of Tanzania," World Development, Elsevier, vol. 67(C), pages 218-237.
    22. Beegle, Kathleen & Dehejia, Rajeev H. & Gatti, Roberta, 2006. "Child labor and agricultural shocks," Journal of Development Economics, Elsevier, vol. 81(1), pages 80-96, October.
    23. Wolfram Schlenker & W. Michael Hanemann & Anthony C. Fisher, 2005. "Will U.S. Agriculture Really Benefit from Global Warming? Accounting for Irrigation in the Hedonic Approach," American Economic Review, American Economic Association, vol. 95(1), pages 395-406, March.
    24. Olivier Deschênes & Michael Greenstone, 2007. "The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather," American Economic Review, American Economic Association, vol. 97(1), pages 354-385, March.
    25. de Janvry, Alain & Fafchamps, Marcel & Sadoulet, Elisabeth, 1991. "Peasant Household Behaviour with Missing Markets: Some Paradoxes Explained," Economic Journal, Royal Economic Society, vol. 101(409), pages 1400-1417, November.
    26. Katrina Jessoe & Dale T. Manning & J. Edward Taylor, 2018. "Climate Change and Labour Allocation in Rural Mexico: Evidence from Annual Fluctuations in Weather," Economic Journal, Royal Economic Society, vol. 128(608), pages 230-261, February.
    27. -, 2009. "The economics of climate change," Sede Subregional de la CEPAL para el Caribe (Estudios e Investigaciones) 38679, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aragón, Fernando M. & Restuccia, Diego & Rud, Juan Pablo, 2022. "Are small farms really more productive than large farms?," Food Policy, Elsevier, vol. 106(C).
    2. Francisco Costa & Fabien Forge & Jason Garred & João Paulo Pessoa, 2020. "Climate Change and the Distribution of Agricultural Output," Working Papers 2003E, University of Ottawa, Department of Economics.
    3. Francisco Costa & Fabien Forge & Jason Garred & João Paulo Pessoa, 2023. "The Impact of Climate Change on Risk and Return in Indian Agriculture," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 85(1), pages 1-27, May.
    4. Tran, Thi Xuyen, 2021. "Typhoon and Agricultural Production Portfolio -Empirical Evidence for a Developing Economy," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242411, Verein für Socialpolitik / German Economic Association.
    5. Tran, Thi Xuyen, 2021. "Typhoon and Agricultural Production Portfolio Empirical Evidence for a Developing Economy," Working Paper 188/2021, Helmut Schmidt University, Hamburg.

    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. Fernando M. Aragón & Francisco Oteiza & Juan Pablo Rud, 2018. "Climate change and agriculture: farmer adaptation to extreme heat," IFS Working Papers W18/06, Institute for Fiscal Studies.
    2. Fernando M. Aragón & Francisco Oteiza & Juan Pablo Rud, 2018. "Climate Change and Agriculture: Farmer Adaptation to Extreme Heat," Discussion Papers dp18-02, Department of Economics, Simon Fraser University.
    3. Cui, Xiaomeng & Tang, Qu, 2024. "Extreme heat and rural household adaptation: Evidence from Northeast China," Journal of Development Economics, Elsevier, vol. 167(C).
    4. Chengzheng Li & Zheng Pan, 2021. "How do extremely high temperatures affect labor market performance? Evidence from rural China," Empirical Economics, Springer, vol. 61(4), pages 2265-2291, October.
    5. Castells-Quintana, David & Lopez-Uribe, Maria del Pilar & McDermott, Thomas K.J., 2018. "Adaptation to climate change: A review through a development economics lens," World Development, Elsevier, vol. 104(C), pages 183-196.
    6. Huang, Kaixing & Zhao, Hong & Huang, Jikun & Wang, Jinxia & Findlay, Christopher, 2020. "The impact of climate change on the labor allocation: Empirical evidence from China," Journal of Environmental Economics and Management, Elsevier, vol. 104(C).
    7. Francisco Costa & Fabien Forge & Jason Garred & João Paulo Pessoa, 2020. "Climate Change and the Distribution of Agricultural Output," Working Papers 2003E, University of Ottawa, Department of Economics.
    8. Xiaoguang Chen & Madhu Khanna & Lu Yang, 2022. "The impacts of temperature on Chinese food processing firms," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(2), pages 256-279, April.
    9. Li, Chengzheng & Cong, Jiajia & Gu, Haiying & Zhang, Peng, 2021. "The non-linear effect of daily weather on economic performance: Evidence from China," China Economic Review, Elsevier, vol. 69(C).
    10. Cui, Xiaomeng & Zhong, Zheng, 2024. "Climate change, cropland adjustments, and food security: Evidence from China," Journal of Development Economics, Elsevier, vol. 167(C).
    11. Farzana Hossain & Reshad N. Ahsan, 2022. "When it Rains, it Pours: Estimating the Spatial Spillover Effect of Rainfall," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(2), pages 327-354, June.
    12. Francisco Costa & Fabien Forge & Jason Garred & João Paulo Pessoa, 2023. "The Impact of Climate Change on Risk and Return in Indian Agriculture," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 85(1), pages 1-27, May.
    13. Emediegwu, Lotanna E. & Wossink, Ada & Hall, Alastair, 2022. "The impacts of climate change on agriculture in sub-Saharan Africa: A spatial panel data approach," World Development, Elsevier, vol. 158(C).
    14. Christoph Albert & Paula Bustos & Jacopo Ponticelli, 2024. "The effects of climate change on labor and capital reallocation," Economics Working Papers 1887, Department of Economics and Business, Universitat Pompeu Fabra.
    15. Castells-Quintana, David & del Pilar Lopez-Uribe, Maria & McDermott, Thomas K.J., 2018. "A review of adaptation to climate change through a development economics lens," Working Papers 309605, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    16. repec:ags:aaea22:335522 is not listed on IDEAS
    17. Lyu, Zhuoyang & Yu, Li & Liu, Chen & Ma, Tiemeng, 2024. "When temperatures matter: Extreme heat and labor share," Energy Economics, Elsevier, vol. 138(C).
    18. Jaqueline Oliveira & Bruno Palialol & Paula Pereda, 2021. "Do temperature shocks affect non-agriculture wages in Brazil? Evidence from individual-level panel data," Working Papers, Department of Economics 2021_13, University of São Paulo (FEA-USP).
    19. Shahzad Alvi & Faisal Jamil & Roberto Roson & Martina Sartori, 2020. "Do Farmers Adapt to Climate Change? A Macro Perspective," Agriculture, MDPI, vol. 10(6), pages 1-12, June.
    20. He, Xi & Chen, Zhenshan, 2022. "Weather, cropland expansion, and deforestation in Ethiopia," Journal of Environmental Economics and Management, Elsevier, vol. 111(C).
    21. Cui, Xiaomeng, 2020. "Climate change and adaptation in agriculture: Evidence from US cropping patterns," Journal of Environmental Economics and Management, Elsevier, vol. 101(C).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:arx:papers:1902.09204. 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: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    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.