Decision Making under Climate Risks: An Analysis of Sub-Saharan Farmers’ Adaptation Behaviors

Abstract

Abstract This paper examines decision making under climate risks using farmers’ decisions in sub-Saharan Africa, where climate risks are very high. Two risk measures are obtained from the Climate Research Unit’s high-resolution climatology, diurnal temperature range (DTR) and coefficient of variation in precipitation (CVP), which are both averages of 30-yr climate data. Farm surveys of around 7600 households were matched cell by cell with the climate risk data. This paper finds that climate risks are indeed highest in the lowland arid zones in the Sahel. A spatial logit analysis shows that farmers in sub-Saharan Africa have adapted their agricultural systems to varying degrees of the CVP and the DTR. In the long term, if the CVP were to increase by 30%, an integrated system would increase by 7.0%. On the other hand, the two specialized systems fall: a crops-only system falls by 5.3% and a livestock-only system falls by 1.7%. When the DTR increases, farmers adapt by switching to a specialized livestock system. Under increased climate risks, this paper finds that farmers in the lowland savannahs and arid zones in the Sahel, where climate risks are high at present, will adapt by switching to an integrated system. Studies of climate risks, therefore, must account for behavioral responses of the individuals. These results can be utilized to help African farmers to adapt to increasing climate risks.