The effect of agricultural total factor productivity on environmental degradation in sub-Saharan Africa

Abstract

The debates on the effect of agricultural productivity on environmental quality have received great importance from researchers and policymakers. On one hand, agricultural productivity is considered to promote economic growth and environmental quality, and on the other hand, increase profitability through higher agricultural productivity encourages cropland expansion which causes deforestation and degrades the environment. In view of the foregoing, this study attempts to examine the effect of agricultural total factor productivity on carbon dioxide emissions using a panel of 38 sub-Saharan Africa (SSA) countries over the period 1981–2016. The outcome from the Fully Modified Ordinal Least Square and Canonical Cointegration Regression models reveal that the link between agricultural total factor productivity and carbon dioxide emissions in SSA shows a U-shaped relationship. This implies that agricultural productivity initially reduces carbon dioxide emissions to a certain point, beyond which higher agricultural productivity increases carbon dioxide emissions, contradicting the Borlaug hypothesis. Likewise, income has a U-shaped relationship with carbon dioxide emissions, implying that the Environmental Kuznets curve hypothesis does not hold for SSA. Further findings show that urbanization and trade openness increase carbon dioxide emissions. Thus, policies that improve environmental outcomes in the agricultural sector should be promoted.