Please join us for this Virtual Winter Seminar Series with our Speaker: Fiona Burlig, Ph.D.
Title: Groundwater, energy, and crop choice
Abstract: Groundwater is a key resource for agricultural production globally. Both increasingly rapid drawdowns of aquifers as well the policies intended to increase aquifer sustainability increase costs to agricultural producers, with unknown consequences. In this paper, we provide the first large-scale empirical estimates of how farmers respond to changes in groundwater costs in one of the world’s most valuable agricultural areas: California. To do this, we assemble a novel dataset that combines (i) detailed restricted-access microdata on farmers’ electricity consumption, (ii) rich data from technical audits of these farmers’ pump efficiencies, (iii) measurements of groundwater depths in California aquifers, and (iv) satellite-derived measures of crop cover. For identification, we leverage exogenous variation in the price of electricity, a key marginal input into the groundwater production function. We find that farmers are very price responsive: we estimate large price elasticities of demand for electricity (1.17) and groundwater (1.12). We demonstrate that crop switching and following are the main channel through which farmers respond to increases in groundwater costs. Using a discrete choice model, we estimate that a counterfactual $10 per-acre-foot groundwater tax—approximately the price increase required to meet California’s sustainability targets—would lead farmers to reallocate 8 percent of cropland, with increases in fallowing and high-value fruit and nut perennials and decreases in annual crops and low-value perennials.
Bio: Dr. Fiona Burlig is an Assistant Professor at the Harris School of Public Policy and a Faculty Research Fellow at the National Bureau of Economic Research. She studies energy and environmental economics, with a focus on the developing world. Her recent research examines the impacts of rural electrification in India, uses machine learning methods to quantify the effectiveness of energy efficiency upgrades, and proposes tools for designing randomized controlled trials. Prior to joining Harris, Fiona was a Postdoctoral Scholar in the Department of Economics and Energy Policy Institute (EPIC) at the University of Chicago. She holds a PhD in agricultural and resource economics from the University of California, Berkeley, and a BA in economics, political science, and German from Williams College.
Zoom Info: Join URL: https://stanford.zoom.us/j/96270238492?pwd=ZXhnaURqbVZKcFhET0ZHbjU4NDFpdz09
A special thanks to our ESS PI, David Lobell for bringing this speaker to us. Also, thanks to Morgan O'Neill and Jamie Jones for co-instructing and running this Virtual Seminar Series This Winter by bringing you experts in the fields as we learn from them. If you wish to have a private meet with her, please send me an email to schedule you in ASAP @ firstname.lastname@example.org