This paper links two different methodologies to determine the effects of climate change on the
Western Cape farm sector. First, it uses a general circulation model (GCM) to model future
climate change in the Western Cape, particularly with respect to precipitation. Second, a sector
mathematical programming model of the Western Cape farm sector is used to incorporate the
predicted climate change, specifically rainfall, from the GCM to determine the effects on key
variables of the regional farm economy. In summary, results indicate that future climate change
will lead to lower precipitation, which implies that less water will be available to agriculture in
the Western Cape. This will have a negative overall effect on the Western Cape farm economy.
Both producer welfare and consumer welfare will decrease. Total employment in the farm sector
will also decrease as producers switch to a more extensive production pattern. The total decline
in welfare, therefore, will fall disproportionately on the poor.
