Farmers’ Net Income Distribution and Regional Vulnerability to Climate Change: An Empirical Study of Bangladesh

Abstract

Widespread poverty is the most serious threat and social problem that Bangladesh faces. Regional vulnerability to climate change threatens to escalate the magnitude of poverty. It is essential that poverty projections be estimated while bearing in mind the effects of climate change. The main purpose of this paper is to perform an agrarian sub-national regional analysis of climate change vulnerability in Bangladesh under various climate change scenarios and evaluate its potential impact on poverty. This study is relevant to socio-economic research on climate change vulnerability and agriculture risk management and has the potential to contribute new insights to the complex interactions between household income and climate change risks to agricultural communities in Bangladesh and South Asia. This study uses analysis of variance, cluster analysis, decomposition of variance and log-normal distribution to estimate the parameters of income variability that can be used to ascertain vulnerability levels and help us to understand the poverty levels that climate change could potentially generate. It is found that the levels and sources of income vary greatly among regions of Bangladesh. The variance decomposition of income showed that agricultural income in Mymensingh and Rangpur is the main cause of the total income difference among all sources of income. Moreover, a large variance in agricultural income among regions is induced by the gross income from rice production. Additionally, even in the long run the gradual, constant reduction of rice yield due to climate change in Bangladesh is not a severe problem for farmers. However, extreme events such as floods, flash floods, droughts, sea level rise and greenhouse gas emissions, based on Representative concentration pathways (RCPs), could increase the poverty rates in Mymensingh, Rajshahi, Barisal and Khulna—regions that would be greatly affected by unexpected yield losses due to extreme climatic events. Therefore, research into and development of adaptation measures to climate change in regions where farmers are largely dependent on agricultural income are important.