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A Ricardian analysis of the impact of climate change on African cropland

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P. Kurukulasuriya
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This paper 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, the study analyses the impact of climate and other variables on the annual net revenue. The authors confirm that current climate change affects the net revenues of farms across Africa. Applying these results to possible future climate change effects reveals that dryland farms are especially climate sensitive.It is noted that African farms are sensitive to climate change especially temperature. It finds that farm net revenues are lower in places with higher temperatures. The temperature elasticity with respect to the net revenue of African farms is estimated to be -1.3 - this means a 10% increase in temperature will lead to a 13% decline in net revenue. Irrigated farms, by contrast, are resilient to temperature changes and may actually increase in value (partly because of their location in temperate regions of Africa). The report concludes that the drylands alone provide a biased forecast of the overall effect of climate change on all farms since irrigated farms are much more robust to warming than dryland farms. The authors recommend that African countries should begin to plan for climate contingencies. Governments should develop contingency plans to tackle or adapt to certain climate outcomes. They should anticipate what farmers will do, how markets will react, and what role as governments will play to mitigate the adverse effects of climate change.