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Tuesday, September 14th 2021

Charles Regnacq (BRGM) will present "Climate Change and the Water Capability to Export Agricultural Goods".

Abstract:

This article analyzes how climate change by affecting the water capabilities of nations to export agricultural goods plays on comparative advantages. Using rich micro-level data on hydrological conditions, we estimate the agricultural trade elasticity of water for countries with diffrent level of vulnerability to climate change. Non-linear effects are observed, both the most and the less vulnerable countries have higher water elasticities of trade than emerging countries. By simulating the effect of climate change in 2050 on trade flows, we find substantial reduction in the exports of African, Southeast Asian, and South American countries which are not compensated by the growing exports of other nations. Many countries lose their specialization while a handful of nations strengthening their comparative advantages. We illustrate the origin of these variations, by describing how the local hydrological conditions evolve inside countries for different production such as coffee in South America, wheat and maize in the USA, rice in Asia, cassava in Africa and potatoes in Europe.