More than Mean Effects: Modeling the Effect of Climate on the Higher Order Moments of Crop Yields

43 Pages Posted: 30 Sep 2011

See all articles by Jesse Tack

Jesse Tack

Kansas State University

Ardian Harri

Mississippi State University - Department of Agricultural Economics

Keith H. Coble

Mississippi State University - Department of Agricultural Economics

Date Written: September 29, 2011

Abstract

The ability of farmers to manage crop production in the presence of severe weather uncertainty is an important factor for maintaining adequate agricultural production, and this uncertainty is expected to be exacerbated under most climate change scenarios. We present a generalized version of previous models linking weather to yield outcomes that is capable of identifying the casual implications of weather on the entire yield distribution. Importantly, this approach does not require an ex ante distributional assumption and is flexible enough to admit both positive and negative skewness. We consider the case of Arkansas, Mississippi, and Texas upland cotton to demonstrate how temperature and irrigation affect the shape of the yield distribution. Results suggest that high temperatures and lack of irrigation concentrate yield outcomes toward the lower tail of the distribution; thus having significant implications for price variability, risk management, crop insurance, and other commodity support programs.

Keywords: crop yields, climate change, maximum entropy

JEL Classification: Q10, Q18, C14

Suggested Citation

Tack, Jesse and Harri, Ardian and Coble, Keith H., More than Mean Effects: Modeling the Effect of Climate on the Higher Order Moments of Crop Yields (September 29, 2011). Available at SSRN: https://ssrn.com/abstract=1935401 or http://dx.doi.org/10.2139/ssrn.1935401

Jesse Tack (Contact Author)

Kansas State University ( email )

Manhatten, KS 66506-4001
United States

Ardian Harri

Mississippi State University - Department of Agricultural Economics ( email )

Box 5187
Mississippi State, MS 39762
United States

Keith H. Coble

Mississippi State University - Department of Agricultural Economics ( email )

Box 5187
Mississippi State, MS 39762
United States

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