Journal
CLIMATE CHANGE ECONOMICS
Volume 2, Issue 2, Pages 149-174Publisher
WORLD SCIENTIFIC PUBL CO PTE LTD
DOI: 10.1142/S2010007811000255
Keywords
Microanalysis of farm firms; farm households; farm input markets; irrigation; agriculture and environment; climate global warming
Categories
Funding
- Global Environment Facility
- CEEPA, University of Pretoria
- World Bank
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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.
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