Climate change and irrigation in Turkey: A CGE approach

Agricultural production is heavily dependent on water availability for increasing productivity and decreasing volatility in production. However climate change is expected to increase the sectoral competition for water resources and raise the need for major changes in water policies. This study is the first to analyze the likely effects of climate change and changes in the Turkish economy via an economy-wide Walrasian Computable General Equilibrium model with a detailed account of the agricultural sector: 20 agricultural activities in each of the 5 regions are differentiated as irrigated and rainfed. Major macroeconomic indicators change significantly. The decline in GDP is significant. Wage rate falls, while other factors’ prices increase. Production of irrigated crops decline significantly. Balance of trade in agricultural products becomes negative. Rural households benefits from the increase in the agricultural prices, while urban households are hit hard.