Technological Growth, Climate Change, and Rural Labor Markets

Researcher: Anthony Louis D'Agostino, CDEP Fellow and PhD Student in Sustainable Development, SIPA

Casual agricultural labor markets are intrinsically tied to farm productivity; when harvests are good, demand for labor is high, while the opposite holds in poor seasons. This relationship is of particular importance to smallholders and landless laborers often reliant on earnings from casual labor, with knock-on effects on their household income and food availability. This project examines two interwoven issues impacting such labor markets in India. First, the long-run effects of technological change in agricultural labor are not entirely understood. What are the distributional implications of productivity growth? To what degree do wage laborers benefit from broader improvements in yields and volatility-reducing investments? The Green Revolution, which began in the 1960s, resulted in the rapid expansion of investments in high-yielding crop varieties, irrigation networks, and fertilizers, and provides the setting for addressing these questions.

The second component of this project examines technology's prospective role in reducing losses anticipated from climate change. Since India already experiences extreme temperatures with real, negative effects on crop outcomes, data collected over the past few decades can help in identifying to what extent technology adoption has mitigated weather-induced losses. While previous research has demonstrated a clear relationship between weather exposure and crop outcomes, there is still a limited understanding of how labor markets respond to heat shocks and whether high-agricultural technology locations can insulate casual wages and labor demand from these shocks.