Impacts of climate change on Tunisian olive oil output

Abstract

This paper proposes to model the long-run impact of climate change on olive oil output in Tunisia – the third largest olive oil producing country in the world – using panel cointegration techniques. The long-run analysis reveals that rising temperatures and inappropriate working tools reduce olive output in semi-arid areas. Therefore, we propose an appropriate training for workers to develop their skills and a public policy subsidizing the innovation of used capital stock, at least in the southern regions. We propose to encourage the development of drought-tolerant olive trees – especially in the south of Tunisia, where global warming has caused a severe drought.