Sustainable Development and the Dilemma of Egyptian Economic Growth and Climate Change: 1917-2015

Abstract

It is forecasted that 250,000 people will die every year because of climate change and that 86.4 percent of the world population will be living in poverty by 2050. Previous literature has highlighted the tradeoff between poverty reductions and eliminating environmental degradation. Improving the livelihood of the poor therefore has to include improving the environment as well; especially that the poor suffer disproportionally from the effects of environmental decline. This paper tests the long term impact of climate change on economic growth in Egypt over a time period of 98 years using the Threshold model. The estimated threshold regression model suggests 22.9o C as the threshold value of temperature rate above which temperature significantly retards the growth rate of GDP. In addition, below the threshold level, there is a statistically significant positive relationship between Temperature and growth.