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General Equilibrium Models: A Computable General Equilibrium Model to Analyze the Effects of an Extended Drought on Economic Sectors in México

  • Alejandra Elizondo
  • María Eugenia IbarraránEmail author
  • Roy Boyd
Chapter

Abstract

The agricultural sector in Mexico is small in terms of its relative contribution to GDP, but significant in terms of its total employment. Overall, the primary sector, which includes agriculture, livestock and forestry accounts for only 4% of GDP but employs roughly 15% of the labor force. The agricultural sector is highly vulnerable to climate change due to the severe impact which higher temperatures and modifications in precipitation patterns can have on water availability and plant growth. Conversely, omissions from the agricultural sector can also contribute to climate change. The pumping of water for agricultural purposes, for example, is currently subsidized through low electricity prices, leading to both the overuse of electricity, (produced by fossil fuels) and the depletion of groundwater sources. Consequently, policies such as ethanol production have been promoted in Mexico with the stated goal of climate change mitigation.

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Copyright information

© Springer Nature Switzerland AG 2018

Authors and Affiliations

  • Alejandra Elizondo
    • 1
  • María Eugenia Ibarrarán
    • 2
    Email author
  • Roy Boyd
    • 3
  1. 1.CONACYT-CIDE, Centro de Investigación y Docencia EconómicasMexico CityMexico
  2. 2.Department of EconomicsUniversidad Iberoamericana PueblaPueblaMexico
  3. 3.Department of EconomicsOhio UniversityOhioUSA

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