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Methodologies Yielding CLimate IMpact Assessments Through Economics

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Economic modelling shows impact of soil and climate change on agriculture

It might seem obvious that soil characteristics would significantly influence crop production, but this is actually underexplored. MYCLIMATE correlated soil and weather to track changes in agricultural production due to climate change.

Climate Change and Environment

The influence of soil characteristics has often been neglected by mainstream agricultural economics. This is now starting to change as soil comes to be regarded as a useful buffer against climate change, for example for carbon capture and storage. The study of agricultural economics often doesn’t include an analysis of the positive, and negative, impacts of soil characteristics, temperature and rainfall. The EU-supported MYCLIMATE project was set up to help correct this. “Some modelling simply can’t adequately take into account the dynamic properties of natural systems. MYCLIMATE used methods to represent the variable effects of soil, temperature and rainfall,” explains Simone Pieralli, the Marie Skłodowska-Curie Actions fellow responsible for the project. Taking French field crop production for the period 1990-2015, MYCLIMATE found that climatic variables accounted for 58.5 % of the variability in output, on average over 25 years. This variability was additionally accounted for by changes in inputs – such as fertilisers – (22 % of variation), technological adaptation (18 % of variation) and changes to soil characteristics (1.5 % of variation).

Applying production economics modelling

MYCLIMATE bridged the gap between two previously separate branches of economics. “I saw the pros and cons of climate econometric methods and production economics index theory and so applied a mix of the two to climate change,” adds Pieralli. The project was granted the use of confidential European Commission farm accountancy data network information which held crop output data from French farms from 1990 to 2015. Annually, data is collected from a sample of commercial farms by region, size and type of agriculture. Farms are approached on a rotation basis: participating some years and not others. This data was paired to environmental data, including for soil properties – principally soil carbon and soil pH – recorded in the GIS SOL (website in French) database in France. Analysis also included daily weather data from the Joint Research Centre, with grid-marked locations and a 25 km resolution. MYCLIMATE also used daily minimum and maximum temperature, alongside daily precipitation data. This meant that for each day of the 25 years, MYCLIMATE could mathematically reconstruct how many hours each grid location was exposed to certain temperatures.

Policy implications

A key finding was the influence of increasing weather variability, on average over the 25 years, but especially after the year 2000. This has important implications for policies which need to be focused on the critical drivers of production. “If weather is key to determining output variability rather than farm-managed inputs like fertilisers, then subsidising farmers could be considered more important during climatically difficult years,” says Pieralli. A complication acknowledged by Pieralli is that climate change impacts will be felt differently depending on the region, crops and even timing of the weather events considered. For example, some winter crops may be relatively unaffected by summer droughts and heatwaves. Whereas some wines may be favoured by climate change. With one of the main methods developed by MYCLIMATE already publicly available in a working paper from INRAE, Pieralli is working to publish further results. Currently he is continuing to research the interplay between economics, soil and climate change, while based in New Zealand. “I want to develop methods to consider farm-specific production impacts, the influence of farm location, and timing of weather events, and most importantly, introduce pollution and emissions into the equation,” he concludes.


MYCLIMATE, soil, temperature, crop, agricultural, farm, precipitation, climate change, soil PH, soil carbon, economics, modelling

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