Most of us are familiar with David Friedman's beautiful application of fixed and marginal costs to housing. If you live in a warm climate, you spend not too much on insulation. The marginal cost of increasing the internal temperature is then higher, so you keep your house cooler. If you live in a cold climate, you have to incur the insulation cost because the alternative is likely freezing to death indoors. The marginal cost of heating is then lower and so you'll have warm houses in cold climates and cold houses in warm climates.
New Zealand lamb farmers are currently experiencing massive stock losses due to a big snowstorm down south. This isn't exactly unprecedented; it seems like every second or third year since we've been here, there's been a big snow storm during lambing somewhere in the country that has killed a bunch of lambs and ewes. This one seems worse than prior years' though.
These pretty heavy stock losses always puzzled me a bit. I grew up on a mixed farm in southern Manitoba. Our beef cattle calved out starting around the third week in February and finishing in March. If calving went later, then there'd be elevated risk of scours for the calves with the mucky spring thaw and variable temperatures - the calves needed to strengthen up a bit before the spring. And so the first calves often were born on very cold February nights. Daytime highs of -20 celsius or worse; nighttime lows of -40 celsius weren't completely uncommon, though -30 was more typical.
But we never had stock losses like the farmers here have with snowstorms. With about 50 or 60 cows calving out in a season, we might have gotten two or three calves that didn't make it; those deaths were far more typically due to the cow lying on the calf or strangling during an unattended birth than to being born in a snowbank at -40. Here, it's likely hundreds of thousands of lambs that are dying in the snow. Why? Friedman's story. Because the weather was on average terrible, we had to use practices adapted to it. The young cows stayed in a corral near the barn where they could be quickly attended to if things went wrong; the more experienced cows were in another corral also close to the barn. They were all on straw bedding with lots of good hay and alfalfa (lucerne). If they weren't, they'd all have frozen or starved to death in the pastures. So the marginal cost of ramping things up a bit on a really cold night - putting out more fresh straw bedding and being extra sure to go out two or three times overnight if a cow was due instead of once or twice - wasn't that high. But the farmers here have all their stock out in paddocks far from help. The marginal cost of getting them to a paddock close to the house in the very short notice before a serious snowstorm is high, and keeping them all on hay close to the house would waste a lot of winter paddocks.
And so you get dead stock in warm paddocks and relatively happy cows at -40.
It's likely all optimal. But I wonder whether having adapted to this kind of agricultural practice hasn't helped make things like Crafar more likely.