Wednesday, December 10, 2014

Adapting to extreme heat

Since we are nearing the holidays, I figured I should write something a bit more cheerful and encouraging than my standard line on how we are all going to starve.  My coauthor Michael Roberts and I have emphasized for a while the detrimental effect of extreme heat on corn yields and the implications for a warming planet.  When we looked at the sensitivity to extreme heat over time, we found an improvement (i.e., less susceptibility) roughly around the time hybrids were introduced in the 30s,  but that improvement soon vanished again around the 1960s.   Heat is as susceptible to heat now as it was in 1930.  Our study simply allowed the effect of extreme heat to vary smoothly across time, but wasn't tied to a particular event.

David Popp has been working a lot on innovation and he suggested to look at the effect of hybrid corn adaptation on the sensitivity to extreme heat in more detail.  Richard Sutch had a nice article on how hybrid corn was adopted slowly across states, but fairly quickly within each state.  David and I thought we could use the fairly rapid rollout within state but slow rollout across state as source of identification of the role of extreme heat. Here's a new graph of the rollout by state:
The first step was to extended the daily weather data back to 1901 to take a look at the effect of extreme heat on corn yields over time - we wanted a pre-period to rule out that crappy weather data in the early 1900s results in a lot of attenuation bias but get significant results with comparable coefficients when we use data from the first three decades of the 20th century.

In a second step we interact the weather variables with the fraction of the planted area that is hybrid corn. We find evidence that the introduction of corn is reducing the sensitivity of hybrid corn from -0.53 to -0.33 in the most flexible specification in column (3b) below, which is an almost 40% reduction. Furthermore, the sensitivity to precipitation fluctuations seems to diminish as well. (Disclaimer: these are new results, so they might change a bit once I get rid of my coding errors).
The table regresses state-level yields in 41 states on weather outcomes.  All regressions include state-fixed effects as well as quadratic time trends. Columns (b) furthermore include year fixed effects to pick up common shocks (e.g., global corn prices). Columns (1a)-(1b) replicate the standard regression equation we have been estimating before, columns (2a)-(2b) allow the effect of extreme heat to change with the fraction of hybrid corn that is planted, while columns (3a)-(3b) allow the effect of all four weather variables to change in the fraction of hybrid corn.

In summary: there is evidence that at least for the time period when hybrid corn were adopted that innovation in crop varieties lead to an improvement in heat tolerance, which would be extremely useful as climate change is increasing the frequency of these harmful temperatures.  On that (slightly more upbeat note): happy holidays.

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