The Millennium Droughts and Australian Agricultural Productivity Performance: A Nonparametric Analysis

Abstract

With the turn of the century, Australian agricultural productivity growth slowed dramatically. We investigate the connection between this slowdown and climatic factors by comparing regional‐level growth patterns before and after the advent of the Australian Millennium Droughts. The analysis incorporates climatic variates directly into the productivity accounting framework to reflect the stochastic nature of agricultural production, and measured productivity growth is decomposed into four components: technological change, weather‐related change, input‐scale adjustment, and diffusion (adaptation). Nonparametric productivity measurement and statistical techniques are used to quantify and examine the patterns of the observed productivity slowdown. The analysis suggests that the primary determinant of the slowdown is not a slowdown in technological innovation but climatic‐related changes in the pattern and rate of diffusion of technological advances.

Anthropogenic climate change has slowed global agricultural productivity growth

“…In conclusion, our study suggests that ACC is increasingly reducing agricultural output as we drift away from a climate system without human influences, cumulating into a detectable and sizeable impact as of 2020. Given recent productivity slowdowns (11)(12)(13)(14), the long lags in agricultural research, and the rapid pace of ACC, our findings raise the question whether current levels of investments in agricultural research are sufficient to sustain 20 th century rates of productivity growth in the 21 st century. where 𝑅 !…”

“…Enhancing agricultural productivity is vital to lifting global living standards and advancing sustainable food production in the face of escalating challenges to agriculture and the environment (1)(2)(3)(4)(5)(6)(7). Investments in agricultural research have boosted agricultural productivity, but this growth in productivity has been distributed unequally across the world (8)(9)(10), and there are signs that it is slowing down (11)(12)(13)(14). At the same time, human activities during the last century and a half caused global temperatures to rise by more than 1°C above their pre-industrial values (15).…”

A nonparametric analysis of climate change nexus on agricultural productivity in Africa: implications on food security

“…Their results showed productivity increases that are linked to long-term climate effects. Recently, Chambers and Pierall (2020) recognized the stochastic nature of climate variables in a nonparametric framework and incorporated them directly into the production function analysis (Chambers and Pieralli, 2020; Chambers et al ., 2020). The authors found climate-related changes rather than technological innovation to be the primary determinant of the slowdown in productivity growth.…”

“…The authors found climate-related changes rather than technological innovation to be the primary determinant of the slowdown in productivity growth. Based on the evidence, the authors warned that excluding the effects of weather in productivity estimation could result in a potential bias in TFP estimates (Chambers et al ., 2020). In the same way, Plastina et al .…”

“…However, due to the differential nature of the climate–agriculture effects, as evident in previous studies, the current study uses a single output, comprising the aggregate production value of 162 crops in a panel of 42 countries, to estimate the nonparametric DEA-Malmquist index and compare the results across the five geopolitical regions of Africa. Our objective is similar to previous studies conducted in the USA (Liang et al ., 2017; Chambers et al ., 2020; Plastina et al ., 2021). As far as we know, this study is one of the very few that used the nonparametric DEA-Malmquist method to control for the direct effect of climate change factors on agricultural TFP growth.…”