What is it about?

This paper examines the effect of climate change adaptation on the productive efficiency of subsistence farming using a recently introduced selection bias correction method under the framework of stochastic frontier analysis. Using a three-wave of panel data from Ethiopia, we find that climate change adaptation improves productive efficiency albeit the effect is crop-specific.

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Why is it important?

Climate change continues as a serious threat to our world. its impact is more prevalent in the least developed countries where the lion's share of their economy is dominated by the agriculture sector which is highly vulnerable to climate-related shocks. Climate change adaptation has been widely suggested as an instrument to deal with climate-related shocks. However, how different adaptation strategies impact the efficiency of smallholder farmers is not clearly known. This paper is very important in addressing this question. At the same time, it also provides policymakers first-hand evidence about which adaptation strategy is appropriate for different crops.

Perspectives

While impact evaluation is widespread in the literature, a dearth of study is available in the framework of stochastic frontier analysis (SFA). Hence, this paper is one of the limited studies that use appropriate impact evaluation techniques in the SFA context. In this regard, it brought an enormous methodological contribution to the growing literature.

Fissha Asmare
Vilnius University

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This page is a summary of: Climate change adaptation and productive efficiency of subsistence farming: A bias‐corrected panel data stochastic frontier approach, Journal of Agricultural Economics, February 2022, Wiley, DOI: 10.1111/1477-9552.12479.
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