Climate Change Effects on Agricultural Production: The Regional and Sectoral Economic Consequences in China

Abstract Climate is an essential element in agricultural production, and climate change inevitably have an impact on agriculture. Assessing the economic consequences of climate change requires comprehensive assessments of the impact chain from climate to crops and the economy. In our previous study, we derived a dose‐response function to estimate the response of crop yields to climate variables through a systematic review. In this paper, a dynamic multiregional input‐output model is established to assess the economic consequences of changes in agricultural production on China's regional and sectoral levels. The results show that (1) the direct economic damage is equivalent to 1% of gross domestic product (GDP) which implies the resulting economic cascade effect (ECE) that amounts to 17.8% of China's GDP. At the end of 21st century, the ECE is −0.1% to 13.6% of GDP (negative values indicate economic gains) without considering CO2 fertilization effect, of which the ECE in the most pessimistic pathway are equivalent to the total agricultural output in China today. (2) Regional‐level results show an uneven distribution of economic impact in China, which is related to the regional economic development. The least developed region in China experiences 2.8 to 8.5 times more ECE caused by climate change than the most developed region. (3) Sector‐level results show that agriculture is still the main affected sector, but in developed regions, manufacturing and services also bear part of the ECE.