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Abstract
Global agricultural commodity markets are highly integrated among major producers. Prices are driven by aggregate supply rather than what happens in individual countries in isolation. Estimating the effects of weather-induced shocks on production, trade patterns and prices hence requires a globally representative weather data set. Recently, two data sets that provide daily or hourly records, GMFD and ERA5-Land, became available. Starting with the US, a data rich region, we formally test whether these global data sets are as good as more fine-scaled country-specific data in explaining yields and whether they estimate similar response functions. While GMFD and ERA5-Land have lower predictive skill for US corn and soybeans yields than the fine-scaled PRISM data, they still correctly uncover the underlying non-linear temperature relationship. All specifications using daily temperature extremes under any of the weather data sets outperform models that use a quadratic in average temperature. Correctly capturing the effect of daily extremes has a larger effect than the choice of weather data. In a second step, focusing on Sub Saharan Africa, a data sparse region, we confirm that GMFD and ERA5-Land have superior predictive power to CRU, a global weather data set previously employed for modeling climate effects in the region.
Estimating weather-induced shocks on food production requires reliable global weather datasets. Here, the authors compare global (GMFD and ERA5-Land) and regional (PRISM) datasets, showing that global datasets can uncover non-linear temperature relationships despite their lower predictive skill.
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1 Columbia University School of International and Public Affairs, New York, USA (GRID:grid.21729.3f) (ISNI:0000 0004 1936 8729)
2 NBER and CEPR, Columbia University School of International and Public Affairs, New York, USA (GRID:grid.21729.3f) (ISNI:0000 0004 1936 8729)