Impacts of climate change on global agri-food trade

Bozzola, Martina and Lamonaca, Emilia and Santeramo, Fabio Gaetano (2023): Impacts of climate change on global agri-food trade.

Abstract

Climate change and trade are closely related. Climate may alter the comparative advantages across countries, which may in turn trigger changes in trade patterns. Trade itself may constitute an adaptation strategy, moving excesses of agri-food supply to regions with shortages, and this in turn may explain changes in land-use. We investigate these linkages, showing that the changes in climate affect counties’ trade value and contribute to reshaping trade patterns. First, we quantify the long-term impacts of climate on the value of agri-food exports, implicitly considering the ability of countries to adapt, and show that higher marginal temperatures and rainfall levels tend to be beneficial for countries’ exports. Following a gravity model approach, we then link the evolving trade patterns to climate change adaptation strategies. We find that the larger the difference in temperatures and rainfall levels between trading partners, the higher the value of bilateral exports. Furthermore, while developed and developing exporters are both sensitive to climate change and to cross-countries heterogeneity in climate, we found their responses to changes in climate to be quite diverse.

• Item Type: MPRA Paper
• Language: English
• Keywords: Climate normal; Climate heterogeneity; Export; Economic development.
• Subjects: F - International Economics > F1 - Trade > F18 - Trade and Environment; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O44 - Environment and Growth; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q1 - Agriculture > Q17 - Agriculture in International Trade; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q54 - Climate ; Natural Disasters and Their Management ; Global Warming

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