EFFECT OF CLIMATE CHANGE ON AGRICULTURAL OUTPUT IN ETHIOPIA
Keywords:Ethiopia, ARDL method of co integration, agricultural output, climate variable
AbstractCurrently climate change is known as the major environmental problem the world face. Its effect is openly reduces agricultural output in particular and economic growth in general. The aim of the study was to examine the long run and short run effect of climate change on agricultural output in Ethiopia over a period of 1980-2016. The ARDL approach to co integration was applied to examine the long run and short run effect of climate change on agricultural output. ADF test was used for Unit root test. The finding of bound test shows that there is stable long run relationship between RAGDP, labour force, Mean annual rainfall, Average temperature, agriculture land, and fertilizer input import. The estimated long run model reveals that climate changes have an important effect on agricultural output which is the main contributor of overall GDP of the country. The coefficient of error correction term is -0.738 suggesting about 73.8% percent annual adjustment towards long run equilibrium. The estimate coefficients of short run show that mean annual rainfall have significant effect but average temperature is insignificant effect on output. In the long run both main variable of interest have significant effect on agricultural output with a positive effect from mean annual rainfall and negative effect from average temperature. To reduce the effect of climate change the study recommends government and stakeholders needs to create a specific policies to reduce the effect of climate change especially focus on technological innovation that avert effect of increase in temperature that would result increase on the output and adopting technology at macro and micro level..
Akram Neam (2016) Climate change: A threat to the economic growth of Pakistan, Ministry of Economic Affairs, Islamabad, Pakistan
Amsalu W. Yalew(2016) Economy-wide Effects of Climate Change in Ethiopia
Agricultural Transformation Agency (ATA). (2016), annual report Addis Ababa, Ethiopia
Barrios S, Strol E, and Ouattra B(2007) The Impact of Climatic Change on Agricultural Production: Is it different for Africa? Food Policy, 33(4), p. 287–298
Brooks, C. (2008). Introductory Econometrics for Finance. Cambridge, Cambridge University Press
Deschenes, O., & Greenstone, M. 2004. The Economic Impacts of Climate Change: Evidence from Agricultural Profits and Random. NBER Working Paper Series No. 10663. cambridge: National Bureau of Economic Research
Enders ,W.(1996). Applied Econometric Time Series. Lowa State University: John Wiley &Sons
Engle, R. F. and Granger, C.W.J. (1987). Co-integration and Error Corrections: Representation, Estimation and Testing. Econometrica, 55(2), 251-276
Ferede T, Ayenew B and. Hanjra A(2010) AGroecology Matters: Impacts Of Climate Change On Agriculture And Its Implications For Food Security In Ethiopia
Gebreegziabher, Z., Stage, J., Mekonnen, A., and Atlaw, A. (2011). Climate Change and the Ethiopian Economy: A Computable General Equilibrium Analysis. EfD DP 11-09. Discussion Paper Series. Environment for Development Initiative
Granger, C. W. J. and Newbold, P. (1974). Spurious Regressions in Econometrics. Journal of Econometrics, 2, 111-120
International Monetary Fund (IMF). (2016) country report of Ethiopia
Intergovernmental Panel on Climate Change (IPCC) (2014) Climate change report adaption, impact and vulnerability regional aspects
Intergovernmental Panel on Climate Change (IPCC) (2007) climate change sysnthesis report Geneva, Switzerland
Jonathan E. Ogbuabor and , Emmanuel I. Egwuchukwu (2011) The Impact of Climate Change on the Nigerian Economy, International Journal of Energy Economics and Policy ISSN: 2146-4553 available at http: www.econjournals.com, International Journal of Energy Economics and Policy, 2017, 7(2), 217-223.
Naeem Akram, (2007) is climate change hindering economic growth of Asian economies?
National Meteorological Agency (NMA). (2007), “Climate Change National Adaptation Program of Action (NAPA) of Ethiopia,” NMS, Addis Ababa, Ethiopia
Paul Alagidede, George Adu, And Prince And Boakye Frimpong ( 2014) The Effect Of Climate Change On Economic Growth Evidence From Sub-Saharan Africa Wider Working Paper
Pesaran, M. H. a. Smith. (1998). "structural analysis of co integration VARS." Journal of economic surveys 12(5): 471-505
Pesaran M.H, R.J. Smith, and Y. Shin,(1996) Testing for the Existence of a long
run Relationship, DAE Working paper No.9622, Department of Applied
Economics, University of Cambridge,
Samuel Tekste (2012) determinants of agricultural export performance in Ethiopia
Seid Nuru Ali (2012) Climate Change and Economic Growth in a Rain-fed Economy: How Much Does Rainfall Variability Cost Ethiopia? Ethiopian Economics Association Working Paper Series. Addis Ababa, Ethiopia.
Solow, R. (1956). A Contribution to the Theory of Economic Growth. Quarterly Journal of Economics, 70(1), 65-94
Temesgen Tadesse Deressa, 2007 Measuring The Economic Impact Of Climate Change On Ethiopian Agriculture: Ricardian Approach, Policy Research Working Paper
United States Agency for International Development,(USAID), (2013) Ethiopia vulnerability climate profile
Wanjiru and Ruigu (2017) determinants of agricultural productivity in Kenya, international journal of economics, commerce and management vol,V
WB (World Bank) 2008 A Country Study on the Economic Impacts of Climate Change
Zhai, F. and Zhuang, J. (2009), "Agricultural Impact of Climate Change: A General Equilibrium Analysis with Special Reference to Southeast Asia,".
How to Cite
Journal of Economic Development, Environment and People by Authors is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
Based on a work at http://ojs.spiruharet.ro/index.php/jedep/issue/archive.