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This research study examines the effect of climate change on agriculture in Sri Lanka using the Ricardian method to look at how net revenue varies across climatic zones in Sri Lanka. The Ricardian method accounts for the direct impacts of climate on yields of different crops as well as the indirect substitution of different inputs, introduction of different activities, and other potential adaptations by farmers to different climates. Two separate models were estimated to capture changes in the net revenue of paddy and plantation crops due to climatic changes in 24 districts in the country.
According to the projected changes in rainfall and temperature in 2050, revenues of paddy cultivation decrease very significantly in 2050 -- this negative impact is mainly due to the change in rainfall. In contrast, there will be an overall gain in plantation revenues due to the increase rainfall in the central hill areas. However, the overall impacts on agricultural production and GDP in 2050 are negative.
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