Abstract
Ocean-related decadal climate variability (ODCV) has the potential to influence regional climates and, in turn, crop yields. ODCV event forecasts with associated climate and crop yield implication information can provide farmers with the opportunity to alter their crop mixes and input usage to adapt to the forecast conditions. We investigate the value of ODCV information and the nature of adaptations. This is done by estimating the changes in welfare under differing information scenarios using a nonlinear dynamic optimization model. We find evidence that both perfect forecasts and the use of forecasts permitting a conditional probability of future phase combinations can significantly increase agriculture consumer and producer welfare. This is a new result that is an estimate of the US national value of releasing ODCV forecasts and accompanying yield information.
Highlights
Ocean-induced climate variability has been found to lead to changes in precipitation, temperature, and the incidence of extreme events over land, in turn influencing agricultural production
In order to find the value of Ocean-related decadal climate variability (ODCV) information, we first found the effects of the ODCV events on the climate variables and, in turn, the effect on crop yields both nationally and regionally
The econometric analysis examined the effects of ODCV phase combinations on climate and, in turn, crop yields
Summary
Ocean-induced climate variability has been found to lead to changes in precipitation, temperature, and the incidence of extreme events over land, in turn influencing agricultural production. Ocean phenomena collectively referred to as decadal climate variability (ODCV) influence the climate, in turn influencing agricultural production and economic returns. Three such ODCV phenomena are the Pacific Decadal Oscillation (PDO), the Tropical Atlantic gradient (TAG), and the West Pacific Warm Pool (WPWP) [3,4,5]. These ODCV phenomena have been found to alter climate conditions over land. WPWP phases have been associated with larger amounts of precipitation [10,11,12,13]
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