Environmental and technological changes such as climate change and technology development greatly affect rural farmers’ decisions in agricultural production, consumption, and employment. As one of the most important issues in agricultural and development economics, understanding how farmers respond to these changes in different institutional contexts has important policy implications. This dissertation addresses three different types of changes—climate change, income shocks, and road construction in three developing countries—Ukraine, India, and China accordingly and investigates rural farmers’ behavioral and welfare responses to these changes in agricultural production, consumption, and employment.The first essay, titled “Climate and Agricultural Production in Ukraine”, examines the impacts of climate change on agricultural production in Ukraine. Using the combination of large-scale survey data from 46,799 farms and daily temperature and precipitation data from CORDEX, the essay examines the short-term yield response of five main crops in Ukraine—winter wheat, spring barley, sunflower, soybean, and corn to yearly temperature and precipitation changes, and the impacts of climate change on agricultural adaptation. The empirical results first suggest that the overall rising temperature is associated with short-run rises in the yields of all five main crops—winter wheat, spring barley, sunflower, soybean, and corn in Ukraine. While for cold season crops—winter wheat and spring barley, crop yields respond negatively to exposure to heat accumulation above a crop-specific stressful temperature bound (29/30°C). In terms of adaptation, the study unveils the adaptations of winter wheat growers to long-run temperature changes and adaptations of sunflower, soybean, and corn growers to long-run precipitation changes. Moreover, farms are also found with more diversified crop structures in response to negative climate shocks. The second essay, titled “Social Network and Consumption Smoothing in Rural India”, explores the impact of the caste-based social network on consumption smoothing behavior of rural households in India. The results first suggest that full insurance or efficient risk-sharing, i.e., consumption is not associated with idiosyncratic income changes when common shocks are controlled, is achieved within the three backward caste groups but not within the forward caste groups or at the village level. The relatively high expenditure on necessary food items of the backward caste groups is likely to be a potential mechanism that explains the heterogeneity in consumption smoothing across caste groups. Furthermore, the study examines the impact of social interaction norms across castes on consumption smoothing. The result suggests that the consumption of those households who only interact with other households within the same caste or caste groups comoves less with idiosyncratic income changes than those who also interact with other caste or caste groups, which implies the potential positive impact of intra-caste networks on consumption smoothing in India. Moreover, the essay also explores the relationship between migration work and consumption smoothing and finds that households with migrant working experience do better in consumption smoothing. The third essay, titled “Road Infrastructure and Rural Employment in China”, examines the impacts of various road infrastructures on farmers’ employment choices in rural China, based on farm-level panel data from three rounds of household surveys spanning from 2000 to 2013 and the road infrastructure data from GIS data. The empirical results first indicate that the road infrastructure at the county, provincial/national levels are positively associated with farmers’ tendency toward and intensity of local non-agricultural employment while is negatively associated with farmers’ tendency toward and intensity of migration work (mainly driven by the impacts on part-time employment). Moreover, denser local roads—village and township roads are found associated with more local part-time non-agricultural employment but less non-local part-time employment. Furthermore, observable heterogeneities in the impacts of road infrastructure on rural employment across gender and region are also discovered in the study.
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