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The Impact of Climate Change on U.S. Agriculture: New Evidence on the Role of Heterogeneity and Adaptation

Author

Listed:
  • Michael Keane

    (Oxford University and UNSW Australia Business School)

  • Timothy Neal

    (University of New South Wales)

Abstract

This paper investigates the impact of climate change on the productivity of crop production using U.S. county-level yield and weather data between 1950 and 2015. It finds that the pooled estimators used in previous studies underestimate the sensitivity of crops to high temperatures by ignoring slope heterogeneity, and underestimate the damage of future climate change on yield. Furthermore, explicitly modelling this heterogeneity provides a natural approach to measuring the degree of adaptation to climate change in the data. It concludes with evidence that further adaptation may mitigate up to half of the substantial losses to crop productivity forecast by 2050

Suggested Citation

  • Michael Keane & Timothy Neal, 2017. "The Impact of Climate Change on U.S. Agriculture: New Evidence on the Role of Heterogeneity and Adaptation," Economics Papers 2017-W03, Economics Group, Nuffield College, University of Oxford.
    • Handle: RePEc:nuf:econwp:1703
    as

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    File URL: https://www.nuffield.ox.ac.uk/economics/papers/2017/ClimateChangeandCropYieldAERSubmissionRC.pdf
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    References listed on IDEAS

    as
    1. Timothy Neal, 2016. "Multidimensional Parameter Heterogeneity in Panel Data Models," Discussion Papers 2016-15, School of Economics, The University of New South Wales.
    2. Pesaran, M. Hashem & Smith, Ron, 1995. "Estimating long-run relationships from dynamic heterogeneous panels," Journal of Econometrics, Elsevier, vol. 68(1), pages 79-113, July.
    3. 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.
    4. Mendelsohn, Robert & Nordhaus, William D & Shaw, Daigee, 1994. "The Impact of Global Warming on Agriculture: A Ricardian Analysis," American Economic Review, American Economic Association, vol. 84(4), pages 753-771, September.
    5. Andrews, Donald W K, 1993. "Tests for Parameter Instability and Structural Change with Unknown Change Point," Econometrica, Econometric Society, vol. 61(4), pages 821-856, July.
    6. Kentaro Kawasaki & Shinsuke Uchida, 2016. "Quality Matters More Than Quantity: Asymmetric Temperature Effects on Crop Yield and Quality Grade," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(4), pages 1195-1209.
    7. 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.
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    Cited by:

    1. Perry, Edward, 2018. "Climate Change Adaptation: Planting Date and Soil Temperatures in U.S. Corn," 2018 Annual Meeting, August 5-7, Washington, D.C. 274348, Agricultural and Applied Economics Association.

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