The empirical literature on climate change and agriculture does not adequately address the issue of potential endogeneity between climatic variables and agriculture, which makes their estimates unreliable. This paper aims to investigate the relationships between climate change and agriculture and test the potential reverse causality and endogeneity of climatic variables to agriculture. This study introduces a geographical instrument, longitude and latitude, for temperature to assess the impact of climate change on agriculture by estimating regression using IV-two-stage least squares method over annual panel data for 60 countries for the period of 1999-2011. The identification and F-statistic tests are used to choose and exclude the instrument. The inclusion of some control variables is supposed to reduce the omitted variable bias. The study finds a negative relationship between temperature and agriculture. Surprisingly, the magnitude of the coefficient on temperature is mild, at least 20 per cent, as compared to previous studies, which may be because of the use of the instrumental variable (IV), which is also supported by an alternative robust measure when estimated across different regions. The study provides strong implications for policymakers to confront climate change, which is an impending danger to agriculture. In designing effective policies and strategies, policymakers should focus not only on crop production but also on other agricultural activities such as livestock production and fisheries, in addition to national and international socio-economic and geopolitical dynamics. This paper contributes to the growing literature in at least four aspects. First, empirical settings introduce an innovative geographical instrument, Second, it includes a wider set of control variables in the analysis. Third, it extends previous studies by involving agriculture value addition. Finally, the effects of temperature and precipitation on a single aggregate measure, agriculture value addition, are separately investigated.

Can improving access to mobile extension improve agricultural productivity? Recent evidence suggests both significant and insignificant ways in which SMS-based agricultural information could affect farming outcomes. It is unclear if variations in the programs’ design or the methodological challenges in evaluating the programs cause wide-ranging impacts. Extension hotline services provide rapid, unambiguous information by agricultural experts over the phone, tailored to time- and crop-specific shocks. Using methods from experimental economics, we randomly distributed the hotline number to generate exogenous variation in the access to farming information. We conducted our study among 300 farmers in the South Indian state of Karnataka. Our results show that eliminating informational inefficiencies increases farmers’ average yields for a high-stakes pigeon pea crop that faced adverse aggregate shock. The impact on the yield is through the adoption of cost-effective and improved farming practices. However, we do not observe any effect on the crops that were not affected by the shock. Our findings reveal that advisory recommendations customized to time- and crop-specific shocks are associated with a greater impact on agricultural productivity.

Effects of Bacillus thuringiensis (Bt) cotton are at the forefront of an intense debate on the benefits of genetically modified (GM) crops among smallholder farmers in developing countries. Existing studies fail to control for confounders, selection bias, or cultivation bias from preferential treatment in the initial adoption phase. Addressing these concerns in this paper, I examine the impact of Bt cotton employing an unbalanced panel fixed-effects model of a crop yield and profit function on newly collected plot-level data in the most recent decade. Results show that Bt cotton yields have stagnated, have a null effect on profits, and have become more sensitive to pest pressure in the most recent decade. Though many studies have demonstrated higher crop yield and profit gains in the first decade of Bt cotton adoption that raised the average returns to the technology, the second decade shows convergence in benefits, which raises obvious questions about the prospect of GM technology. Since Bt cotton is the only GM crop technology widely adopted by smallholder farmers, the findings of this paper contribute to the broader public debate on the future of agricultural biotechnology.