Climate and Rural Income

This paper tests whether climate has an impact on per capita rural income. The study finds that total (agricultural and nonagricultural) income in rural counties and municipios in the US and Brazil are affected by climate. The study demonstrates that this income effect is due to changes in the net value of agriculture. Regions with better climates for agriculture support higher rural incomes and regions with poor climates have more rural poverty. The results also suggest that global warming will likely increase rural poverty.