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A Structural Ricardian Valuation of Climate Change Impacts on Agriculture in Pakistan

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Mirza Nomman Ahmed

This book presents the economic analysis of the impacts of climate change on agriculture in Pakistan. Particular emphasis is laid on the magnitude of implicit adaptations in overall climate impact assessment and the analysis of selected adaptation options. Using a hedonic pricing model and a revealed choice approach, this study identifies the impacts of climate change on agricultural incomes, depicts the spatial patterns and seasonality of the impacts, and models the future adaptation behavior of farmers in the crop sector. A high sensitivity of farming in Pakistan to climate change is confirmed. With a changing climate and income in mind, farmers in Pakistan are more likely to choose rice, vegetables and maize, whereas they move away from wheat, sugarcane, cotton and fruits.

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2 The Agriculture Sector of Pakistan

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Pakistan is a predominantly agricultural country with a diverse climate that can be distinguished into ten broad agro-climatic zones. The topography ranges from high mountain peaks in the north to wide stretching plains in the south. A significant portion of the population depends on the agricultural sector with its backward and forward linkages. To this effect, the country’s agricultural policy plays a pivotal role for guaranteeing the functioning of markets and the facilitation of trade, all directed towards the ultimate goal of providing food security for the approximately 170 million inhabitants. Moreover, the country is home to the largest irrigation network that at the same time is also the largest glacial melt fed system worldwide. Key crops are wheat, cotton, rice, sugarcane, maize and vegetables. This chapter is devoted to revealing the importance of the sector by starting off with the explanation of the country’s geography and soils and climatic diversity, which is followed by an overview on the water resources. Furthermore, land use patterns, major crops, land reforms and tenurial systems are discussed alongside deliberations on the importance of the sector for the economy, which also includes an overview on agricultural policies. 2.1 Geography and Soils Pakistan is located in Southern Asia between 24-37°N of latitude and 61-76°E of longitude. The 36th largest country of the world, spreads over a total geographical area of 796.000 km² and is bordered by the four independent states India (East), Iran (Southwest), Afghanistan (West) and China (Northeast). In the south the...

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