Long-term Economic Effects of Aridification on the GDPs of Africa and Asia

Abstract

We examine the effects of human-induced deserti cation on economic growth by exploiting a 56 km-by-56 km grid-cell global dataset on the annual frequency from 1990-2015. We nd that areas that experienced large soil aridi cation are associated with a reduction in GDP per capita. Our results indicate that from 1990-2015, aridi cation reduced the GDPs of African and Asian countries by 12% and 2.7%, respectively. Our estimates are robust to adding higher-order terms of geo-climatic variables and controlling for country-speci c linear trends, which allows us to project future costs of deserti cation. Our ndings show that deserti cation will generate losses in GDP growth by 16% and 6.7% in Africa and Asia, respectively.