Paper on degree days forthcoming in Energy Economics

How Well Do Degree Days over the Growing Season Capture the Effect of Climate on Farmland Values?

Emanuele Massetti, Robert Mendelsohn, Shun Chonabayashi

Abstract

Farmland values have traditionally been valued using seasonal temperature and precipitation but degree days over the growing season offers a more compact form. We find that degree days and daily temperature are interchangeable over the growing season. However, the impact of degree days in spring and summer are quite different. Climate effects outside the growing season are also significant. Cross sectional evidence suggests seasonal temperature and precipitation are very important whereas temperature extremes have relatively small effects.

How do heat waves, cold waves, droughts, hail and tornadoes affect US agriculture?

A very first draft of a new paper on climate extremes available here. Still preliminary and incomplete.

Presented today at the ASSA meetings in San Francisco. Presentation available here.

Abstract:

We estimate the impact of extreme events on corn and soybeans yields, and on agricultural land values in the Eastern United States. We find the most harmful event is a severe drought but that cold waves, heat waves, and storms all reduce both corn and soybean yields. Over 80% of the damage from extreme events is caused by droughts and cold waves with heat waves causing only 6% of the damage. Including extreme events in a panel model of weather alters how temperature affects yields, making cold temperature more harmful and hot temperatures less harmful. Extreme events have no effect on farmland values probably because American farmers are buffered from extreme events by subsidized public crop insurance.