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The Impact of Climate Change on Rice Yields: the Importance of Heterogeneity and Family Networks | CFSP | Consortium on Financial Systems and Poverty

The Impact of Climate Change on Rice Yields: the Importance of Heterogeneity and Family Networks

John Felkner
Robert M. Townsend
Kamilya Tazhibayeva
Publication Type: 
Working Papers
Publication Article File: 
Publication Year: 
2012

In this publication, the authors quantify the impact of weather variation and climate change on the production of rain-fed rice, a major crop of Thailand both for domestic consumption and export, as it is for other countries in Southeast Asia. More generally rice and other staple crops are of great importance to the world economy. Crop failure and commodity shortages can lead to disaster, even national calamities. However this story turns out a bit differently. It is a tale of substantial heterogeneity in impact of weather variation for the given contemporary climate, and for climate shift scenarios. Indeed this heterogeneity-induced distinction between aggregate and idiosyncratic shocks takes the authors to the possibility of weather insurance for a given contemporary climate, and of insurance for climate shifts, and how these might be designed. This does extend well beyond the scope of the current paper. Nevertheless, the authors take up the implications of what they have learned in a concluding epilogue section.

This paper was presented by Townsend, along with co-authors Felkner andTazhibayeva, at the Nobel Symposium in September 2012 at the University of Stockholm in Stockholm, Sweden. The video of Townsend's presentation is also available.

Region: 
East Asia and the Pacific
Country: 
Thailand
Topic: 
Agriculture
Topic: 
Economic Modeling
Topic: 
Insurance