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savings or better access to credit that allows them to take better advantage of a forecast of favorable climatic conditions. Some may own a specialized resource, such as a senior water right or a piece of farmland whose value varies with climatic conditions. Some actors may gain advantage in contractual negotiations if they receive and correctly interpret forecast information earlier than others. Such distributional consequences are shaped by actors' situations and by the institutions that shape them (e.g., water law, insurance regulations), by the availability of insurance and credit, and by the design of disaster preparedness and relief programs. It is possible that, in some sectors or regions, the overall benefits of climate forecasts may be distributed so that some groups gain greatly while others do not benefit at all, or even find themselves worse off. If such outcomes arose, they might greatly dampen enthusiasm for climate forecasting.

Responses To Past Climate Predictions

A useful source of information on how weather-sensitive sectors and actors may respond to climate forecasts in the future is their response to past climate forecasts. Unfortunately, skillful forecasts are very recent, so there has been relatively little opportunity to learn from experience. A few case studies have been done of situations in which affected groups have acted on climate or hydrological forecasts on the time scale of months. Three are described below, with the tentative lessons that seem to flow from them. This body of research is far too limited to treat these lessons as more than hypotheses. However, they are valuable because they show responses to actual climate forecasts. Systematic studies based on responses to forecasts of the 1997-1998 El Niño could add greatly to understanding.

Drought Forecasts in the Yakima Valley

Glantz (1982) examined the case of an erroneous forecast of drought in the Yakima valley of Washington state in 1977. Irrigation in the Yakima valley supports some high-value crops, including orchards and mint. In February 1977, the Bureau of Reclamation forecast that water available for summer irrigation in the valley would be less than 50 percent of normal. On the basis of this forecast, they told senior water rights holders that they would receive 90 percent of their allocations and more junior water rights holders that they would only receive 6 percent of their normal allocations—insufficient to protect their perennial crops and orchards from drought. Farmers responded by drilling deep wells at costs of $25,000 to $250,000 per farmer; deciding not to plant a crop but to fallow;

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