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If climate change means more intense and more frequent drought, what will that mean for agricultural production? A case study in Northern Australia

Citation

Tran, LT and Stoeckl, N and Esparon, M and Jarvis, D, If climate change means more intense and more frequent drought, what will that mean for agricultural production? A case study in Northern Australia, Australasian Journal of Environmental Management, 23, (3) pp. 281-297. ISSN 1448-6563 (2016) [Refereed Article]

Copyright Statement

© 2016 Environment Institute of Australia and New Zealand Inc.

DOI: doi:10.1080/14486563.2016.1152202

Abstract

We examine the influence of drought and a variety of factors on agriculture in Northern Australia. Assuming constant prices, and using data collected from northern land managers, we estimate a Cobb–Douglas production function and use coefficients from the model to estimate the financial losses associated with drought. We find that drought-affected properties earn about half as much as other 'similar' properties. We then ask: How much does that 'cost' the industry, on average, and how would those costs change if droughts were to become more, or less widespread under climate change? Our estimates indicate that under the current climatic regime, the Northern Australian agricultural industry loses, on average, about 19% of output to drought each year: this could fall to 10% or rise to 40% under current climate projections. Although focused on Northern Australia, the findings have wider implications for management and adaption, given the magnitude of impacts and their likelihood to extend beyond the 'official' end of drought. Investments in climate-proof crops, on-farm management techniques and financial arrangements to help producers deal with a range of climatic risks, for example, should thus be priorities.

Item Details

Item Type:Refereed Article
Keywords:climate change, drought, agricultural production, Northern Australia, Cobb–Douglas production function
Research Division:Economics
Research Group:Other economics
Research Field:Ecological economics
Objective Division:Economic Framework
Objective Group:Other economic framework
Objective Field:Ecological economics
UTAS Author:Stoeckl, N (Professor Natalie Stoeckl)
ID Code:137244
Year Published:2016
Web of Science® Times Cited:5
Deposited By:College Office - CoBE
Deposited On:2020-02-06
Last Modified:2020-04-30
Downloads:0

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