Measurement of the likely magnitude of the economic impact of climate change on African agriculture has been a challenge. Using data from a survey of more than 9,000 farmers across 11 African countries, a cross-sectional approach estimates how farm net revenues are affected by climate change compared with current mean temperature. Revenues fall with warming for dryland crops (temperature elasticity of -1.9) and livestock (-5.4), whereas revenues rise for irrigated crops (elasticity of 0.5), which are located in relatively cool parts of Africa and are buffered by irrigation from the effects of warming. At first, warming has little net aggregate effect as the gains for irrigated crops offset the losses for dryland crops and livestock. Warming, however, will likely reduce dryland farm income immediately. The final effects will also depend on changes in precipitation, because revenues from all farm types increase with precipitation. Because irrigated farms are less sensitive to climate, where water is available, irrigation is a practical adaptation to climate change in Africa.

This study examines the impact of climate change on cropland in Africa, using a Ricardian cross-sectional approach. Relying on farm data from an 11-country survey of over 9500 farmers, annual net revenue is regressed on climate and other variables. The study confirms that current climate affects the net revenues of farms across Africa. Applying these results to possible future climates reveals that dryland farms are especially climate sensitive. Even as early as 2020, climate change could have strong negative impacts on currently dry and hot locations. By 2100, dryland crop net revenues could rise by 51% if future warming is mild and wet but fall by 43% if future climates are hot and dry. The crop net revenues of currently irrigated farms are likely to be least affected.

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Climate change, Economic impacts, Agriculture, Africa, AEZ,

Although there is now an extensive literature on the economic impacts of climate change on agriculture, no study has yet addressed the endogeneity of irrigation. This paper examines how climate affects the choice to irrigate and the conditional income earned by each farmer. The paper develops a selection model of irrigation choice and conditional income. Using data from farmers across eleven African countries, the paper demonstrates that the choice of irrigation is sensitive to both temperature and precipitation. Rainfed and irrigated farm income also both respond to climate but have different climate sensitivity. Impact models that fail to account for endogenous irrigation are biased.

This study applies the Ricardian technique to estimate the effect of climate change on the smallholder agriculture sector in Sri Lanka. The main contribution of the paper is the use of householdlevel data to analyze long-term climate impacts on farm profitability. Household-level data allows us to control for a host of factors such as human and physical capital available to farmers as well as adaptation mechanisms at the farm level. We find that non-climate variables explain about half the variation in net revenues. However, our results suggest that climate change will have a significant impact on smallholder profitability. In particular, reductions in precipitation during key agricultural months can be devastating. At the national level, a change in net revenues of between −23% and +22% is likely depending on the climate change scenario simulated. These impacts will vary considerably across geographic areas from losses of 67% to gains that more than double current net revenues. The largest adverse impacts are anticipated in the dry zones of the North Central region and the dry zones of the South Eastern regions of Sri Lanka. On the other hand, the intermediate and wet zones are likely to benefit, mostly due to the predicted increase in rainfall.

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The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.