Warming Temperatures and the Choice of Crop Variety: Evidence From Heat‐Avoiding and Heat‐Tolerant Rice in Japan

ABSTRACT Weather and climate cause variation in agricultural production. The extent to which farmers are able to adjust to weather shocks is important for understanding the potential impacts of climate change and formulating agricultural policy. Public and private research organizations have increasingly developed agricultural technologies to help farmers cope with changing climatic conditions. We examine the degree to which farmers adjust production technologies in response to temperature shocks. Using data from Japan, we estimate the effect of high temperatures on the adoption of heat‐tolerant and late‐maturing rice varieties: two technologies that could potentially mitigate the negative impacts of a warming climate. Exposure to extremely high temperatures increases the share of heat‐tolerant rice varieties, while exposure to moderate temperatures increases the share of late‐maturing rice varieties. Projected warming is expected to increase the adoption of these varieties, although varietal adjustment remains incomplete, suggesting potential for policies that support farmers’ adaptation behavior.