Agricultural productivity growth in Latin America and the Caribbean: an analysis of climatic effects, catch‐up and convergence*

Abstract

This paper investigates whether climatic adjusted total factor productivity (CATFP) in Latin America and the Caribbean (LAC) is converging, converging to different steady states or exhibit absolute convergence, that is the process does not require (government) interventions to reach its equilibrium path. We use data from the University of East Anglia’s Climatic Research Unit and from the Food and Agriculture Organization for 28 LAC countries over a 54‐year period (1961–2014) to estimate random parameters stochastic production frontier models to calculate CATFP and then use cross‐sectional regressions and an error correction model to analyse CATFP convergence across countries in the region. The results show that technological progress is the main driver of CATFP growth in the region and there is no absolute convergence, that is CATFP gaps across countries will not decrease over time and least performing countries will not grow faster than better performing ones without targeted policies. However, CATFP across LAC exhibits conditional convergence towards different steady states. Technological progress plays a critical role in raising the steady state level of CATFP with an overall average of 2.22 per cent per annum.

New evidence of the driving forces behind Brazil's agricultural TFP growth—A stochastic frontier analysis with climatic variables and land suitability index

“…Figure 4 depicts the relationship among TFPI and the selected environmental variables of land suitability, rainfall and temperature. A stronger correlation is verified between TFPI and rainfall and temperature; these results corroborate the estimations of Lachaud and Bravo‐Ureta (2020), who determined that climatic variability (especially an increase in average temperature) negatively affects agricultural production in the context of Latin America and the Caribbean.…”

“…Some other examples of early contributions that measured and explained changes in TFP are O'Donnell (2018), Njuki et al. (2018), Lachaud and Bravo‐Ureta (2020), and Lachaud et al. (2022).…”

“…The empirical model estimated in this paper allows us to address the role of the production environment and other managerial techniques in driving productivity growth. Some other examples of early contributions that measured and explained changes in TFP are O'Donnell (2018), Njuki et al (2018), Bravo-Ureta (2020), andLachaud et al (2022). Njuki et al (2018) defined the period-t technology set in the environment z as:…”

Impact of public research investments on agricultural productivity in Chile

“…Trindade and Fulginiti (2015) and Nin‐Pratt et al (2015) investigated the productivity growth of Chilean agriculture and found a slightly higher TFP change of 2.55% and 2.3% for the 1961–2012 period, respectively. Lachaud and Bravo‐Ureta (2021) reported a similar TFP growth rate of 2.2% for Chilean agriculture. In another recent study, Bravo‐Ureta et al (2021) concluded that the Chilean agricultural sector exhibited an overall annual average TFP change of 1.90%, showing better productivity performance than many countries worldwide, particularly LAC countries.…”

Impacts of Climatic Variability on Agricultural Total Factor Productivity Growth in the Southern United States

“…Lachaud et al [16] argue that increasing agricultural land through deforestation or using more resources to meet the future global food demand is not a sustainable or desirable option. Thus, to meet future food needs, it is essential to increase agricultural productivity through technological improvements, especially those that foster resilience to climatic variability and climate change [17][18][19][20].…”