The Ricardian analysis twenty years after the original model: Evolution, unresolved issues and empirical problems

This paper analyses the wide body of literature that concerns applications of the Ricardian approach to assess the economic effects of climate change on agriculture. Beginning with the original model proposed by Mendelsohn, Nordhaus and Shaw in 1994, the article discusses researchers’ main criticisms of the model and the innovations suggested to overcome its limitations. Finally, the study summarises the unresolved issues and empirical problems that need to be examined in future research. New issues to be explored include the capture of future technologies, implementation of price changes, choice of the best variables to represent climate, simulation of seasonal effects and identification of the best technique to hypothesise the relationship between profits and climate. The paper also discusses operative problems, such as the availability of the most suitable data, the adoption of spatialisation techniques and the enlargement of the time horizon to be covered.