TUPD-2021-012
TITLE | Adjustment costs in dynamically optimal pricing of a network good
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AUTHORS | Yi-Chun Ko
Ph.D. Student, Graduate School of Economics and Management, Tohoku University Associate Professor, Graduate School of Economics Nagoya City Univesity
Head, Policy Design Lab, Tohoku University |
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ABSTRUCT | The main purpose of our paper is to explore mechanisms of farmer’s adaptation to climate change. Specifically, we assess the farmer’s adaptation capacity to extremely low and high temperatures by quantifying the effect of farmer’s age and experience on the temperature-yield relationship. We estimate their effects by conducting the panel (short-run adjustment) and long-differences (long-run adaptation) analyses following Burke and Emerick (2016) with the municipality-level rice yield data in Japan from 1993 to 2018. We find that both age and experience of extreme temperatures are significant factors that strengthen the farmer’s adaptation capacity to climate. Age is more likely to help farmers adjust to annual weather fluctuations than to assist long-term adaptation to climate, whilst the past experience of extreme temperatures rather encourages farmers to adapt to the climate in the long run. |
KEYWORDS | Adaptation capacity, Age, Rice, Climate change, Crops yields, Temperature |
ISSUED | November 2021 |
REVISED | March 2022 |