The Economic Impact of Weather Variability on China’s Rice Sector

EfD Discussion Paper
1 January 2014

This paper provides the first county-level analysis of the impacts of weather variability on rice yield in China, by compiling a unique panel on irrigated single-season rice and daily weather data. We found that temperature and solar radiation had statistically significant impacts on rice yield during the vegetative and ripening stages, while the effects of rainfall on yield were not significant.

In contrast to nearly all previous studies focusing on rice production in tropical/subtropical regions, we discovered that higher daily minimum temperature during the vegetative stage increased rice yield in China. Consistent with other studies, higher daily maximum temperature during the vegetative and ripening stages reduced rice yield in China, while the impacts of solar radiation on rice yield varied across the plant’s growth stages. Adaptation of rice production to higher temperatures effectively reduced the adverse impacts of weather variability on rice yield. Combined, our results indicate that weather variability caused a net economic loss of $25.2 million to $60.7 million to China’s rice sector in the past decade, depending on model specifications and econometric estimation strategies.

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Publication | 4 June 2014