The Korean Journal of Economic Studies
The Regional Impacts of Climate Change on Korean Agriculture: A Positive Mathematical Programming A
Kyungwon Park (Seoul National University), Oh-Sang Kwon (Seoul National University, Kwang Soo Kim (Seoul National University)Year 2015Vol. 63No. 1
Abstract
The purpose of this interdisciplinary study is to evaluate the regional impactsof agricultural productivity change and the growing instability of agriculturalproduction using a Korean agricultural sector model. We apply the positivemathematical programming(PMP) approach of Howitt(1995), which has abuilt-in process of keeping the consistency between its model solutions and theobserved data. Moreover, our study makes output prices endogenous byincorporating market equilibrium conditions into the programming model, andallows imperfect substitution between imported and domestic foods followingthe specification of Dixit(1989). This study finds that substantial regional andcommodity substitution will occur in response to climate change, and hence,emphasizes the importance of regional and commodity specific adaption