CLIMATE CHANGE, ADAPTATION AND ECONOMIC OUTCOMES: EVIDENCE FROM AGRICULTURE IN INDIA

Abstract

Agriculture is strongly affected by climate change (CC). However, its vulnerability is also determined by how farmers adapt to these long-run changes. Using an innovative approach recently proposed in the literature, this study investigates whether it is possible to find evidence of long-run adaptation in the climate-yield relationship of India’s agriculture and what the implications for future scenarios may be. District-level time series data on rice and chickpea yield are combined with weather data on cumulative growing season precipitation and growing degree days, and a quadratic regression with fixed effects augmented with climate penalty terms to account for climate adaptation is used. The estimates are utilized to extrapolate future scenarios. The estimation results suggest that rice might have some potential adaptation to precipitation, although adaptation to temperature appears to be dependent on irrigation. Chickpeas, on the other hand, adapt to temperature whereas adaptation to precipitation is limited. The findings also reveal that crop yields in projected climate scenarios are expected to respond differently depending on whether adaptation measures are implemented or not. Adaptation measures are likely to mitigate CC and reduce crop yield losses while also increasing productivity in some crops.