Comparing the effect of climate change on agricultural competitiveness in developing and developed countries

Abstract

Climate change and agriculture are inextricably linked and influence one another. Many studies have been conducted on the topic, but none have focused on developing and developed countries. This study aims to investigate the relationship between climate change and agricultural competitiveness in developing and developed countries. This study examined data from 71 developing countries and 24 developed countries from 1990 to 2020 used the three-stage least squares method. This study found that agricultural competitiveness raises temperatures in developing countries while decreasing temperatures in developed countries. The temperature change has the same effect in developing and developed countries, namely reducing the agricultural competitiveness. However, agricultural competitiveness in developed countries is more sensitive to temperature changes. Other explanatory variables have varying effects on temperature and agricultural competitiveness. We propose the use of technology in agricultural business management, as well as each country's commitment to increase agricultural competitiveness while manage rise in temperatures. Every country must also make efforts to maintain currency stability, be prudent in dealing with economic openness, increase agricultural labor productivity, and improve agricultural business actors' education.