Assessing the sensitivity of climate change impacts in agriculture to the climate–economy functional form

Joey Blumberg

Chapter 4 in Handbook on Climate Change Impacts, Mitigation, and Adaptation in Agriculture, 2026, pp 48-69 from Edward Elgar Publishing

Abstract: The intersection of climate and the economy has garnered considerable attention in recent decades, and this chapter examines how different modeling choices affect estimates of the average and distributional impacts of climate change in agriculture. Using a panel dataset of county-level weather and economic outcomes, marginal effects and non-marginal damage estimates using climate projections are compared across models. Specifications, including flexible, nonlinear terms that allow marginal effects to vary across space, reveal more intuitive results and tend to perform best in model selection criteria. Such models show that temperature sensitivities vary substantially across regions, highlighting spatial heterogeneity in historical adaptation to the climate. When aggregating county-level projected damages to discern an average annual impact for the United States, findings are consistent across models. However, methodologies like degree days and temperature binning—predominant in contemporary literature—manifest geographically conflicting estimates. These results have important implications for targeted policy intervention and benefit–cost analysis.

Keywords: Climate Change; Climate–economy Relationship; Distributional Climate Impacts; Panel Data; Model Selection (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035344963
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