This paper basically researches the impact of climate
change on the agricultural activities in the
semi-tropical area using Taiwan as an example. The
methodology involves a two-step procedure. First,
pooling data on crop yields and climate and other
non-climate-related variables are used to estimate
yield response equations. The yield equations are
used to simulate the physical impacts of alternative climate change scenarios on per hectare yields. This
approach addresses farmer’s adjustments to environmental
conditions and thus provides relatively more
realistic estimates of the magnitude of climate impacts
than do traditional agronomic crop weather models.
Our empirical results on 60 crops in Taiwan show
that, in general, the two climate variables (temperature
and precipitation) have a significant and
non-monotonic impact on crop yields. Climate variations
also have significant implications on many crop
yields, similar to those found in the US. Therefore,
incorporating climate variations should be important
in studying climate impacts on agriculture in subtropical
and tropical regions. The impact of other
tropical climatic anomalies, such as cyclones, El
Niño-southern-oscillation and hurricanes, are also
very critical to the well-being in these regions and
should be explored in the future. In addition, since
seasonal difference are found when examining the impact
of climate on crop yields, future research would
benefit with the availability of data on the time intervals
when crops enter into their various growth stages
as well as the growth-stage-related climate data.
In our second step the predicted yield changes are
incorporated into a model of the Taiwanese agricultural
sector where prices are endogenously determined
and farmer’s adaptations are allowed by varying crop
mixes, land use pattern and input uses in response to
price and yield changes. The welfare implications of
various climate change scenarios are examined. The
comparison result suggests that climate change impacts
on welfare are mostly positive. The impacts on
producers are much more significant than they are on
consumers, with the two climate variables found to
also have quite different implications for consumers
and producers. A temperature rise is not stressful to
Taiwan’s farmers, and may even be beneficial when
adaptation is taken into account. However, the upward
shift in rainfall intensity could be devastating to
farmers’ welfare.
The impact of climate change on agriculture is a
very complicated issue. Many analysts predict that
developing countries in tropical and semi-tropical
regions are the most vulnerable to global warming.
This paper presents a preliminary evaluation on
Taiwan’s relatively modernized agricultural sector.
Unfortunately, because the flexibility in land use,
the ability of farmers to adapt and the existence of adaptation possibilities vary, our results may not be
applicable to other neighboring Asian economies directly.
This leads to a number of potential research
directions such as comparing alternative adaptation
strategies available in tropical and semitropical
regions