Farmers can respond to climate change by modifying their technologies or management practices, or both. In this paper, we examine the choice of crop, irrigation, and cover as a bundled decision by a farmer. Using discrete choice analysis and a cross section of farms from Israel, we test whether these decisions are sensitive to climate and find that they are. In the case of Israel, the farmers completely substitute capital for climate. Simulating increase in temperature suggests that warming would lead Israeli farmers to shift mainly to orchards under cover and irrigation. But it is likely that bundling adaptations will provide flexibility and sustainability for future farmers in many locations under climate change conditions.
Bibliographical noteFunding Information:
The work leading to this paper was funded in part by the German Federal Ministry of Education and Research (BMBF) in collaboration with the Israeli Ministry of Science and Technology (MOST) in the framework of the project GLOWA Jordan River and by the World Bank under the study ‘Climate Change and Rural Development’. The views expressed in this paper are those of the authors and should not be attributed to the World Bank.
- Climate change
- Technology adoption