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Gutierrez, L., Piras, F., & Roggero, P. P. (2015). A global vector autoregression model for the analysis of wheat export prices. American Journal of Agricultural Economics, 97(5), 1494–1511.
Abstract: Food commodity price fluctuations have an important impact on poverty and food insecurity across the world. Conventional models have not provided a complete picture of recent price spikes in agricultural commodity markets, and there is an urgent need for appropriate policy responses. Perhaps new approaches are needed to better understand international spill-overs, the feedback between the real and the financial sectors, as well as the link between food and energy prices. In this article, we present the results from a new worldwide dynamic model that provides the short and long-run impulse responses of the international wheat price to various real and financial shocks.
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Nelson, G. C., van der Mensbrugghe, D., Ahammad, H., Blanc, E., Calvin, K., Hasegawa, T., et al. (2014). Agriculture and climate change in global scenarios: why don’t the models agree. Agric. Econ., 45(1), 85.
Abstract: Agriculture is unique among economic sectors in the nature of impacts from climate change. The production activity that transforms inputs into agricultural outputs involves direct use of weather inputs (temperature, solar radiation available to the plant, and precipitation). Previous studies of the impacts of climate change on agriculture have reported substantial differences in outcomes such as prices, production, and trade arising from differences in model inputs and model specification. This article presents climate change results and underlying determinants from a model comparison exercise with 10 of the leading global economic models that include significant representation of agriculture. By harmonizing key drivers that include climate change effects, differences in model outcomes were reduced. The particular choice of climate change drivers for this comparison activity results in large and negative productivity effects. All models respond with higher prices. Producer behavior differs by model with some emphasizing area response and others yield response. Demand response is least important. The differences reflect both differences in model specification and perspectives on the future. The results from this study highlight the need to more fully compare the deep model parameters, to generate a call for a combination of econometric and validation studies to narrow the degree of uncertainty and variability in these parameters and to move to Monte Carlo type simulations to better map the contours of economic uncertainty.
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Nelson, G. C., van der Mensbrugghe, D., Ahammad, H., Blanc, E., Calvin, K., Hasegawa, T., et al. (2014). Agriculture and climate change in global scenarios: why don’t the models agree. Agric. Econ., 45(1), 85–101.
Abstract: Agriculture is unique among economic sectors in the nature of impacts from climate change. The production activity that transforms inputs into agricultural outputs involves direct use of weather inputs (temperature, solar radiation available to the plant, and precipitation). Previous studies of the impacts of climate change on agriculture have reported substantial differences in outcomes such as prices, production, and trade arising from differences in model inputs and model specification. This article presents climate change results and underlying determinants from a model comparison exercise with 10 of the leading global economic models that include significant representation of agriculture. By harmonizing key drivers that include climate change effects, differences in model outcomes were reduced. The particular choice of climate change drivers for this comparison activity results in large and negative productivity effects. All models respond with higher prices. Producer behavior differs by model with some emphasizing area response and others yield response. Demand response is least important. The differences reflect both differences in model specification and perspectives on the future. The results from this study highlight the need to more fully compare the deep model parameters, to generate a call for a combination of econometric and validation studies to narrow the degree of uncertainty and variability in these parameters and to move to Monte Carlo type simulations to better map the contours of economic uncertainty.
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Robinson, S., van Meijl, H., Willenbockel, D., Valin, H., Fujimori, S., Masui, T., et al. (2014). Comparing supply-side specifications in models of global agriculture and the food system. Agric. Econ., 45(1), 21–35.
Abstract: This article compares the theoretical and functional specification of production in partial equilibrium (PE) and computable general equilibrium (CGE) models of the global agricultural and food system included in the AgMIP model comparison study. The two model families differ in their scopepartial versus economy-wideand in how they represent technology and the behavior of supply and demand in markets. The CGE models are deep structural models in that they explicitly solve the maximization problem of consumers and producers, assuming utility maximization and profit maximization with production/cost functions that include all factor inputs. The PE models divide into two groups on the supply side: (1) shallow structural models, which essentially specify area/yield supply functions with no explicit maximization behavior, and (2) deep structural models that provide a detailed activity-analysis specification of technology and explicit optimizing behavior by producers. While the models vary in their specifications of technology, both within and between the PE and CGE families, we consider two stylized theoretical models to compare the behavior of crop yields and supply functions in CGE models with their behavior in shallow structural PE models. We find that the theoretical responsiveness of supply to changes in prices can be similar, depending on parameter choices that define the behavior of implicit supply functions over the domain of applicability defined by the common scenarios used in the AgMIP comparisons. In practice, however, the applied models are more complex and differ in their empirical sensitivity to variations in specificationcomparability of results given parameter choices is an empirical question. To illustrate the issues, sensitivity analysis is done with one global CGE model, MAGNET, to indicate how the results vary with different specification of technical change, and how they compare with the results from PE models.
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Shrestha, S., Hennessy, T., Abdalla, M., Forristal, D., & Jones, M. J. (2014). Determining short term responses of Irish dairy farms under climate change. German Journal of Agricultural Economics, 63(3), 143–155.
Abstract: This study aimed to determine short term farm responses of Irish dairy farms under climate change. The Irish National Farm Survey data and Irish weather data were the main datasets used in this study. A set of simulation models were used to determine grass yields and field time under a baseline scenario and a future climate scenario. An optimising farm level model which maximises farm net income under limiting farm resources was then run under these scenarios. Changes in farm net incomes under the climate change scenario compared to the baseline scenario were taken as a measure to determine the effect of climate change on farms. Any changes in farm activities under the climate run compared to the baseline run were considered as farm’s responses to maximise farm profits. The results showed that there was a substantial increase in yields of grass (49% to 56%) in all regions. The impact of climate change on farms was different based on the regions. Dairy farms in the Border, Midlands and South East regions suffered whereas dairy farms in other regions generally fared better under the climate change scenario. For a majority of farms, a substitution of concentrate feed with grass based feeds and increasing stocking rate were identified as the most common farm responses. However, farms replaced concentrate feed at varying degree. Dairy farms in the Mid East showed a move towards beef production system where medium dairy farms in the South East regions shifted entire tillage land to grass land. Farms in the South East region also kept animals on grass longer under the climate change scenario compared to the baseline scenario.
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