Publication

How big a threat is global warming to climate-sensitive and economically important sectors such as agriculture in developing countries? How well will farmers be able to adapt to the threats of global warming? This paper attempts to shed light on these two important questions. A cross-sectional analysis is employed to estimate the climate sensitivity of agriculture in Brazil and India. Using panel data from both countries, the study measures how net farm income or property values vary with climate, and consequently, how farmers in India and Brazil react and adapt to climate. The estimated relationships are then used to predict the consequence of alternative climate scenarios. Global warming by the end of the next century could cause annual damages in Brazil between 1% and 39% and between 4% and 26% in India, although some of this effect may be potentially offset by carbon fertilization. These estimates do not factor into account climate-induced extreme weather events. (C) 2008 Elsevier Ltd. All rights reserved.