Climate variability impacts on agricultural output in East Africa

This paper investigates whether the effects of weather variability in temperature and precipitation on agricultural output are short- or long-run. In fact, the study addresses two policy-relevant questions: (1) Does temperature or precipitation variability affect agricultural output, and if so, is the effect short- or long-term? (2) Is the effect of weather variability on agricultural output homogenous across East Africa? However, there is clear evidence of cross-country dependency. If cross-sectional dependency exists among the cross-sectional countries under investigation, the first generation of panel data techniques is not applicable. We use data from the FAOSTAT for 1961 to 2016 for East African countries, while climate-related variables (temperature and precipitation) are from the Climate Research Unit (CRU). We find that variability in temperature has a long-run impact on agricultural output, while variability in precipitation has a short-run effect. However, after considering the heterogeneity among countries, there is evidence of the long-run effect of precipitation variability in some countries.