Importing Inputs for Climate Change Mitigation: The Case of Agricultural Productivity

Abstract

This paper estimates agricultural total factor productivity (TFP) in 162 countries between 1991 and 2015 and aims to understand sources of cross-country variations in agricultural TFP levels and its growth rates. Two factors affecting agricultural TFP are analyzed in detailimported intermediate inputs and climate. We first show that these two factors are independently important in explaining agricultural TFPimported inputs raise agricultural TFP; and higher temperatures and rainfall shortages impede TFP growth, particularly in low-income countries (LICs). We also provide a new evidence that, within LICs, those with a higher import component of intermediate inputs seem to be more shielded from the negative impacts of weather shocks.

The Impact of Global Warming on Rural-Urban Migrations: Evidence from Global Big Data

“…While country-specific evidence exists, there are only a few studies analyzing data from many countries to find a systematic relationship between the level of economic development and the economic or demographic responses to weather shocks. 4 Existing articles investigate the impact of weather shocks on the GDP growth rate (Dell et al, 2012), agricultural productivity (Garcia-Verdu et al, 2019), local conflicts (Bosetti et al, 2018), urbanization (Henderson et al, 2017), and international migrations (Cattaneo and Peri, 2016). These last two studies are those most closely related with our paper.…”

“…13 Dell et al (2012) and Garcia-Verdu et al (2019) find significant impacts of weather shocks in poorer countries only. Mendelsohn et al (2001) and Mendelsohn et al (2006) argue that economic development makes countries less sensitive to weather shocks because more developed countries use technologies that are less sensitive to climate as they are more capital-intensive and sophisticated.…”

“…An increase in temperature reduces GDP and especially stunts agricultural productivity in poor countries as shown in Dell et al (2012) and Garcia-Verdu et al (2019). We use the term δ J (T t ) to capture the negative effects of an increase in temperatures.…”

“…show that the migration likelihood is also a non-linear function of temperature using the householdlevel data from Indonesia. Therefore, some previous studies include the level of temperatures, its square term, and even higher order polynomials to allow non-linearity (e.g.,Burke et al, 2015;Bohra-Mishra et al, 2014) or introduce a step damage function of temperatures by introducing dummies (e.g.,Schlenker and Roberts, 2009;Garcia-Verdu et al, 2019).…”

Sub-Saharan Africa: Building Resilience to Climate-Related Disasters

“…In recent years, the frequency and intensity of droughts, floods, and storms-such as cyclones Idai and Kenneth, and droughts caused by the El Niño-Southern Oscillation (ENSO)-have grown. These disasters are taking a serious toll on the region's economic performance, particularly through agriculture, trade, and services given SSA's reliance on rain-fed agriculture (Jones and Olken, 2010;Garcia Verdu et al, 2019). The consequences are most pronounced for lower income households who are least equipped to handle the consequences of these shocks.…”