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Model Description and Inputs

The ASM (Agriculture Sector Model) is a spatially disaggregate model that simulates the economic equilibrium that arises in the U. S. agricultural sector. It considers the regional impacts of yield changes with endogenous price adjustments. Percentage changes in crop yields for all 63 primary spatial units of the ASM were produced, based on the two different climate changes scenario resolutions, for the elevated CO2 and adaptation cases, and served as input to the economic model.

 

 

Table 1: ASM - Changes in Welfare Results in Billion $

Scenario/Case Consumers Producers Foreign Total Welfare
CSIRO 5.96 -3.31 0.40 3.05
RegCM 3.47 -3.41 0.26 0.32
CSIROA 8.94 -3.87 0.62 5.69
RegCMA 7.76 -4.67 0.51 3.61

The scenario/cases are: CSIRO: CSIRO (coarse) climate change + direct CO2 effect; RegCM: RegCM (fine) climate change + direct CO2 effect; CSIROA: CSIRO (coarse) + adaptation; RegCMA: RegCM (fine) + adaptation.

 

Effects of Mean Yield Changes: On a country wide basis, for the elevated CO2 case, the coarse scale scenario results in a large increased total surplus (or economic welfare) for the agricultural sector, but the fine resolution scenario produced a negligible increase. Change in total surplus depends primarily on the relative changes in consumer surplus and producer surplus.

 

Table 2: Regional Economic Index Numbers

Scenario/
Case
North
East
Lake
States
Corn
Belt
North
Plains
Appa-
lachia
South
East
Delta
States
South
Plains
Mount-
ains
Pacific
CSIRO 118 145 107 110 82 78 84 135 138 121
RegCM 99 137 79 122 72 67 80 147 129 127
CSIROA 122 158 116 123 85 83 86 147 144 134
RegCMA 106 146 83 141 79 80 86 163 138 138

The scenario/cases are: CSIRO: CSIRO (coarse) climate change + direct CO2 effect; RegCM: RegCM (fine) climate change + direct CO2 effect; CSIROA: CSIRO (coarse) + adaptation; RegCMA: RegCM (fine) + adaptation. Regions listed are the mega-regions used in the ASM. The base case has a value of 100.

 

Regional index numbers for the total value of production, which is a measure of economic activity within the regions, show interesting contrasts across the regions, based on the scenarios (Table 2). The Southeast and Appalachia show the largest decreases in activity for both scenarios, but the decrease with the fine scale scenario is much larger. In the Cornbelt the coarse scale scenario results in a gain in activity, while the fine scale scenario shows a clear decrease. Note also that considering all regions, there is greater variability of regional response with the fine scale scenario compared to the coarse scale.

With adaptation, the total surplus increases further for both scale scenarios, and the contrast between the scenarios narrows, but is still discernible. Regarding regional economic activity, conditions improve for most regions, but adaptations do not overcome the negative impacts of the climate change in all regions. For the coarse scale scenario three regions (Appalachia, Southeast, and Delta States) still experience decreased economic activity, while four regions still experience this for the fine resolution scenario.

 

Table 3: SPARM (Stochastic Model) - Changes in Welfare Results in billion $

Scenario/Case Consumer Surplus Producer Surplus Foreign Surplus Total Surplus
CSIRO -2.667 3.241 2.937 3.512
RegCM -4.799 1.504 1.246 -2.049
CSIROA -0.548 4.120 3.860 7.432
RegCMA -0.943 0.695 2.899 2.652

The scenario/cases are: CSIRO: CSIRO (coarse) climate change + direct CO2 effect; RegCM: RegCM (fine) climate change + direct CO2 effect; CSIROA: CSIRO (coarse) + adaptation; RegCMA: RegCM (fine) + adaptation.

 

Additional Effect of Changes in Variability of Yield: The effect of yield variability was incorporated into the ASM. This version of the ASM is referred to as the Stochastic Programming with Recourse ASM or SPARM.

The inclusion of risk (variability) into the analysis changes the basic direction of total welfare effects. Specifically, the non-stochastic results discussed above (elevated CO2 effect case), (small positive in economic welfare for RegCM, and large positive change in economic welfare for CSIRO) are substantially altered. In the CSIRO scenario economic welfare increases further (but only slightly) while for the RegCM scenario welfare becomes substantially negative. This clearly indicates that including the effect of changes in yield variability can significantly affect economic results and it presents the spatial scale effect of the climate scenarios in a more striking light..

 
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State Level Changes in Crop Yields for the Whole U.S.   |   Results of Agricultural Economic Model

Funded by the U.S. Environmental Protection Agency (EPA) Science To Achieve Results (STAR) Program, the National Aeronautics Space Administration (NASA) Mission To Planet Earth (MTPE) - now Earth Science Enterprise (ESE), and the U.S. Department of Agriculture Economic Research Service (ERS).

For more information on this project, please contact Linda Mearns at: lindam@ucar.edu