It's been a long haul, but my coauthor Wolfram Schlenker and I have finally published our article with the title of this blog post in the Proceedings of the National Academy of Sciences . We've been told that it would show up on the early-edition website this week. It hasn't shown up there yet so I guess it will come out tomorrow [Friday 8/28], probably late afternoon EST. UPDATE: You can find the article here . We set out to develop a better statistical model linking weather and U.S. crop yields for corn, soybeans and cotton, the largest three crops in the U.S. in production value. Our major new finding is that (by far) the best predictor of yield is a measure of extreme heat: how much temperatures exceed about 29C (84F) during the growing season. The threshold varies somewhat by crop--29C is the threshold for corn. Below this threshold, warmer temperatures are more beneficial for yields, but the damaging effects of temperatures much above 29C are staggeringly large. A
This morning's slides. I believe slides with audio of the presentation will eventually be posted here . Open publication - Free publishing - More agriculture
I think Mark Thoma nails this . What he describes is exactly the way I think about the issue but have been unable to articulate. To answer the question in the title of this post, it's useful to think of an island with only two goods. One of the goods is non-renewable, but highly desirable. The other good is less preferred, but it is renewable (thinking of renewable and non-renewable energy resources, for example). The key is to distinguish between changes in prices that reflect changes in the relative scarcity of the two goods, and changes driven by increases in the money supply. Over time, as the stock of the more desired good falls due to consumption, the price of this good will rise relative to the renewable good. Consumers will be hit by increases in the cost of living -- the same basket of the two goods purchased last year now costs more. But is this the kind of increase in prices the Fed should respond to? No, the price increase -- and the increase in the c
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