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Managing Environmental Risk in Presence of Climate Change: The Role of Adaptation in the Nile Basin of Ethiopia

Di Falco, Salvatore ; Veronesi, Marcella

In: Environmental and Resource Economics, 2014, vol. 57, no. 4, p. 553-577

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    Titre
    • Managing Environmental Risk in Presence of Climate Change: The Role of Adaptation in the Nile Basin of Ethiopia
    Auteur
    • Di Falco, Salvatore. Department of Economics, University of Geneva, Geneva, Switzerland
    • Veronesi, Marcella. Department of Economics, University of Verona, Verona, Italy
    Type de document
    • Postprint
    Langue
    • Anglais
    Publié dans
    • Environmental and Resource Economics, 2014, vol. 57, no. 4, p. 553-577. Springer Netherlands
    Autre version électronique
    Identifiant OAI-PMH
    • oai:doc.rero.ch:324732
    Summary
    This study investigates the impact of climate change adaptation on farm households' downside risk exposure in the Nile Basin of Ethiopia. The analysis relies on a moment-based specification of the stochastic production function. We use an empirical strategy that accounts for the heterogeneity in the decision on whether to adapt or not, and for unobservable characteristics of farmers and their farm. We find that past adaptation to climate change (i) reduces current downside risk exposure, and so the risk of crop failure; (ii) would have been more beneficial to the non-adapters if they adapted, in terms of reduction in downside risk exposure; and (iii) is a successful risk management strategy that makes the adapters more resilient to climatic conditions.