An interdisciplinary investigation was conducted to assess the impact of climate change on grain yields using an economy-climate model (C-D-C). The model was formulated by incorporating climate factors into the classic Cobb-Douglas (C-D) economic production function model. The economic meanings of the model output elasticities are described and elucidated. The C-D-C model was applied to the assessment of the impact of climate change on grain yields in China during the past 20 years, from 1983 through 2002. In the study, the land of China was divided into eight regions, and both the C-D-C and C-D models were applied to each individual region. The results suggest that the C-D-C model is superior to the classic C-D model, indicating the importance of climate factors. Prospective applications of the C-D-C model are discussed.