Ricardian Framework in single-crop modelling for climatic impact assessment: A discrete choice approach of adaptation behaviours for tea economy in India

Abstract

This paper adopts a two-stage framework by extending the Ricardian approach towards single crop modelling to understand the climatic impact on India's tea plantation sector and evaluate the economic effectiveness of farmer adaptation. The first stage employs a multinomial logit model examining tea growers' rational choice of adaptation technologies based on farm size, terrain characteristics, and climatic conditions. Second stage examines how climate affects the net revenue of each technology. Results indicate that estate size and precipitation are primary factors determining the technology adopted. Each adaptation choice exhibits a very different net revenue response, identifying rainfall as the main stressor while revealing a significant synergistic interaction between winter temperature and precipitation that exceeds their individual effects. Marginal effects and climate simulations demonstrate that optimal adaptation flattens and shifts the profit function, minimizing projected revenue losses under extreme events. Study findings clearly indicate that the climate vulnerability of tea plantation systems can be mitigated by the adoption of optimal farming practices.