Climate change effects on agriculture: economic responses to biophysical shocks

Abstract

Agricultural production is sensitive to weather and thus directly affected by climate change. Plausible estimates of these climate change impacts require combined use of climate, crop, and economic models. Results from previous studies vary substantially due to differences in models, scenarios, and data. This paper is part of a collective effort to systematically integrate these three types of models. We focus on the economic component of the assessment, investigating how nine global economic models of agriculture represent endogenous responses to seven standardized climate change scenarios produced by two climate and five crop models. These responses include adjustments in yields, area, consumption, and international trade. We apply biophysical shocks derived from the Intergovernmental Panel on Climate Change's representative concentration pathway with end-of-century radiative forcing of 8.5 W/m(2). The mean biophysical yield effect with no incremental CO2 fertilization is a 17% reduction globally by 2050 relative to a scenario with unchanging climate. Endogenous economic responses reduce yield loss to 11%, increase area of major crops by 11%, and reduce consumption by 3%. Agricultural production, cropland area, trade, and prices show the greatest degree of variability in response to climate change, and consumption the lowest. The sources of these differences include model structure and specification; in particular, model assumptions about ease of land use conversion, intensification, and trade. This study identifies where models disagree on the relative responses to climate shocks and highlights research activities needed to improve the representation of agricultural adaptation responses to climate change.

Keywords: agricultural productivity; climate change adaptation; integrated assessment; model intercomparison.

Fig. 1.

The impact modeling chain from climate through to crop and economic effects. Abbreviations: Temp, temperature; Prec, precipitation; Cons, consumption.

Fig. 2.

Variability of key crop and economic model results across crop aggregates (n = 4), models (n = 9), scenarios (n = 7), and regions (n = 13). Box-and-whiskers plots for key crop and economic model results. The variables YEXO, YTOT, AREA, PROD, CONS, and PRICE are reported as percentage change for a climate change scenario relative to the reference scenario (with constant climate) in 2050. TRSH is the change in net imports relative to reference scenario production in 2050. Total n is not equal to the full product of dimensions because region–crop pairs without production and consumption in the baseline of a model are not represented for that model. The boxes represent first and third quartiles, and the whiskers show 5–95% intervals of results. The thick black line represents the median, and the thin red dotted line, the mean value.

Fig. 3.

Economic responses of model variables against YEXO, by model. The gray circles represent the PROD results on y axis versus YEXO input on the x axis, obtained in each model for the 13 regions, four crops, and seven scenarios of the analysis. The different lines represent results of univariate regressions for each variable against YEXO. The thick blue line corresponds to the regression on the gray circles; points for other variables are not displayed.