Discussion Paper

Is Weather Really Additive in Agricultural Production? Implications for Climate Change Impacts

Dec 20, 2013 | Ariel Ortiz-Bobea

Abstract

Recent reduced-form econometric models of climate change impacts on agriculture assume climate is additive. This is reflected in climate regressors that are aggregated over several months that include the growing season. In this paper I develop a simple model to show how this assumption imposes implausible characteristics on the production technology that are in serious conflict with the agricultural sciences. I test this assumption using a crop yield model of US corn that accounts for variation in weather at various times of the growing season. Results strongly reject additivity and suggest that weather shocks such as extreme temperatures are particularly detrimental toward the middle of the season around flowering time, in agreement with the natural sciences. I discuss how the additivity assumption tends to underestimate the range of adaptation possibilities available to farmers, thus overstating projected climate change impacts on the sector.