The crucial role of domestic and international market-mediated adaptation to climate change

Climate change effects on agricultural yields will be uneven over the world. A few countries, mostly in high latitudes, may experience gains, while most see average yield decrease. This paper aims to quantify role of market-mediated adjustments attenuating climate by allowing expression new climate-induced pattern comparative advantages within and between countries. To do this, we develop a quantitative general equilibrium trade model where representation land use choice is inspired from modern Ricardian models. We spatially explicit information agronomic literature about potential before after for calibration counterfactual simulations. The results show that changes generate large price movements incentivize production trade. Both contribute reducing welfare losses globally, with making larger contribution.