Is Western European Agriculture Resilient to High Temperatures?
37 Pages Posted: 21 Feb 2019
Date Written: 2018
We estimate a Ricardian model of Western European agricultural land values using farm-level data. We model the effect of temperature on land values using a flexible specification of daily mean temperature to test if there are temperature threshold effects. Results indicate that there are no temperature thresholds beyond which agricultural land values suddenly drop. The results are robust to alternative model specifications. Adaptation explains why a smooth aggregate response function is compatible with sharply non-linear crop yield functions. With adaptation, the effect of warming on Western European agriculture is likely to be smooth.
Keywords: agriculture, climate change, extreme temperature, Ricardian, threshold, Europe
JEL Classification: Q120, Q210, Q510, Q540
Suggested Citation: Suggested Citation