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Many studies have examined the impact of climatic variability on agricultural productivity, although an understanding of these effects on farmland values and their relationship to farmers’ decisions to adapt and modify their land-use practices remains nascent in developing nations. We estimated the impacts of the deviation in our study year's (2012) temperature and precipitation patterns from medium-term (1980–2011) climatic patterns on farmland values in Pakistan. This was accomplished by employing a modified form of a Ricardian regression model. We also examined farmers’ perceptions of climate change during this period, as well as their perceptions of climate change impacts on farm productivity, in addition to past and anticipated farm adaptation strategies. Our results indicate that positive temperature deviation from the medium-term mean – indicative of climatic change – affects farmland values in Pakistan. Deviation in annual cumulative precipitation conversely appears to have no significant impact. Estimates of the marginal impact of temperature deviation suggested a slight but negative linear relationship with farmland values. The location of farms in areas where farmers can avail financial or extension services conversely had a positive impact on farmland values, as did the availability of irrigation facilities. Our analysis of farmers’ perceptions of climate change and their consequent adaptation behavior indicated a relatively high degree of awareness of climatic variability that influenced a number of proactive and future anticipated farm adaptation strategies. Examples included increased use of irrigation and farm enterprise diversification, as well as land-use change, including shifting from agriculture into alternative land uses. National policy in Pakistan underscores the importance of maintaining a productive rural agricultural sector. Our findings consequently highlight the importance of appropriate adaptation strategies to maintain both farm productivity and farmland values in much of Pakistan. The implications of increased extension and financial services to enhance farmers’ potential for climate change adaptation are discussed. [ABSTRACT FROM PUBLISHER]

South Asia is the world’s most poverty-dense region, where climate change and climate variability are expected to result in increased heat stress and erratic precipitation patterns that affect agricultural productivity. Considerable evidence has been generated on the effects of these stresses on crop yield, though previous research has not yet examined their influence on the economic efficiency of cereal producers. Surveying 240 farmers across eight of Pakistan’s twelve agro-ecological zones, we examined the impact of temperature and precipitation anomalies – as indicators of climatic variability – and the number of days when temperature exceeds crop specific heat stress thresholds on the economic efficiency of rice and wheat production. To this end, we employed first-stage stochastic production frontier (SPF) models and second-stage ordinary least square (OLS) and quantile regression models. Both OLS and quantile regressions indicated that terminal heat >34 °C has a significant negative impact on wheat production economic efficiency. Small positive deviation (0.54 °C ± 0.16 SD) of the wheat season’s mean temperature from the medium-term historical mean also significantly and negatively affected economic efficiency across all regression models. Heat stress >35.5 °C during rice flowering in the monsoon also had a significant and negative impact. A slight positive deviation in temperature averaging 0.38 °C (±0.11 SD) above the medium-term mean also had significant negative effects across all regressions. Cumulative precipitation conversely had significant yet contrary effects, by offsetting farmers’ investment in supplementary irrigation and increasing economic efficiency. Our results highlight the fact that indicators of climatic variability and heat stress negatively affect the economic efficiency of both rice and wheat producing farmers. Farmers’ education and access to financial and extension services were however both positively associated with economic efficiency. Our findings point to the importance of developing interlinked agronomic, economic and socio-ecological policy strategies to adapt and increase the resilience of Pakistan’s cereal systems to climatic variability. [ABSTRACT FROM AUTHOR]