IDEAS home Printed from https://ideas.repec.org/p/sfu/sfudps/dp12-08.html
   My bibliography  Save this paper

Mining, Pollution and Agricultural Productivity: Evidence from Ghana

Author

Listed:

Abstract

Most modern mines in the developing world are located in rural areas, where agriculture is the main source of livelihood. This creates the potential of negative spillovers to farmers through competition for key inputs (such as land) and environmental pollution. To explore this issue, we examine the case of gold mining in Ghana. Through the estimation of an agricultural production function using household level data, we find that mining has reduced agricultural productivity by almost 40%. This result is driven by polluting mines, not by input availability. Because of its crowding out effects on agriculture, we find that the mining activity is associated with an increase in poverty, child malnutrition and respiratory diseases. A simple cost-benefit analysis shows that the fiscal contribution of mining would not have been enough to compensate affected populations.

Suggested Citation

  • Fernando Aragon & Juan Pablo Rud, 2012. "Mining, Pollution and Agricultural Productivity: Evidence from Ghana," Discussion Papers dp12-08, Department of Economics, Simon Fraser University.
    • Handle: RePEc:sfu:sfudps:dp12-08
    as

    Download full text from publisher

    File URL: http://www.sfu.ca/repec-econ/sfu/sfudps/dp12-08.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hanna, Rema & Oliva, Paulina, 2015. "The effect of pollution on labor supply: Evidence from a natural experiment in Mexico City," Journal of Public Economics, Elsevier, vol. 122(C), pages 68-79.
    2. Michael Greenstone & Rema Hanna, 2014. "Environmental Regulations, Air and Water Pollution, and Infant Mortality in India," American Economic Review, American Economic Association, vol. 104(10), pages 3038-3072, October.
    3. Halvor Mehlum & Karl Moene & Ragnar Torvik, 2006. "Institutions and the Resource Curse," Economic Journal, Royal Economic Society, vol. 116(508), pages 1-20, January.
    4. Jeffrey D. Sachs & Andrew M. Warner, 1995. "Natural Resource Abundance and Economic Growth," NBER Working Papers 5398, National Bureau of Economic Research, Inc.
    5. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
    6. Fernanda Brollo & Tommaso Nannicini & Roberto Perotti & Guido Tabellini, 2013. "The Political Resource Curse," American Economic Review, American Economic Association, vol. 103(5), pages 1759-1796, August.
    7. Kenneth Y. Chay & Michael Greenstone, 2003. "The Impact of Air Pollution on Infant Mortality: Evidence from Geographic Variation in Pollution Shocks Induced by a Recession," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 1121-1167.
    8. Joshua Graff Zivin & Matthew Neidell, 2012. "The Impact of Pollution on Worker Productivity," American Economic Review, American Economic Association, vol. 102(7), pages 3652-3673, December.
    9. Fernando M. Arag?n & Juan Pablo Rud, 2013. "Natural Resources and Local Communities: Evidence from a Peruvian Gold Mine," American Economic Journal: Economic Policy, American Economic Association, vol. 5(2), pages 1-25, May.
    10. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-1297, November.
    11. Francesco Caselli & Guy Michaels, 2013. "Do Oil Windfalls Improve Living Standards? Evidence from Brazil," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 208-238, January.
    12. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    13. Seema Jayachandran, 2009. "Air Quality and Early-Life Mortality: Evidence from Indonesia’s Wildfires," Journal of Human Resources, University of Wisconsin Press, vol. 44(4).
    14. Vicente, Pedro C., 2010. "Does oil corrupt? Evidence from a natural experiment in West Africa," Journal of Development Economics, Elsevier, vol. 92(1), pages 28-38, May.
    15. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    16. Corden, W Max & Neary, J Peter, 1982. "Booming Sector and De-Industrialisation in a Small Open Economy," Economic Journal, Royal Economic Society, vol. 92(368), pages 825-848, December.
    17. Janet Currie & Eric A. Hanushek & E. Megan Kahn & Matthew Neidell & Steven G. Rivkin, 2009. "Does Pollution Increase School Absences?," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 682-694, November.
    18. Besley, Timothy, 1995. "Property Rights and Investment Incentives: Theory and Evidence from Ghana," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 903-937, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fridtjof Bahlburg, 2023. "The Local Impact of Mining in Peruvian Districts: Evidence of a Subnational Resource Curse?," International Journal of Energy Economics and Policy, Econjournals, vol. 13(4), pages 264-286, July.
    2. Marcel Fafchamps & Michael Koelle & Forhad Shilpi, 2017. "Gold mining and proto-urbanization: recent evidence from Ghana," Journal of Economic Geography, Oxford University Press, vol. 17(5), pages 975-1008.
    3. Wongnaa, Camillus Abawiera & Nti, Emmanuel Kwame & Acheampong, Patricia Pinamang & Bannor, Richard Kwasi & Babu, Suresh Chandra, 2021. "The Shift from Crop Production to Mining Activities in Arable Lands: Evidence from Ghana," 2021 Conference, August 17-31, 2021, Virtual 314946, International Association of Agricultural Economists.
    4. Manuel Pérez Trujillo & Gabriel O. Rodríguez Puello, 2022. "Economic shocks and their effect on the schooling and labor participation of youth: evidence from the metal mining price boom in Chilean counties," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 68(1), pages 65-93, February.
    5. Frederick Armah & Isaac Luginaah & Justice Odoi, 2013. "Artisanal small-scale mining and mercury pollution in Ghana: a critical examination of a messy minerals and gold mining policy," Journal of Environmental Studies and Sciences, Springer;Association of Environmental Studies and Sciences, vol. 3(4), pages 381-390, December.
    6. Lawer, Eric Tamatey & Lukas, Martin C. & Jørgensen, Stig H., 2017. "The neglected role of local institutions in the ‘resource curse’ debate. Limestone mining in the Krobo region of Ghana," Resources Policy, Elsevier, vol. 54(C), pages 43-52.
    7. Alexander B. Lippert, 2014. "Spill-Overs of a Resource Boom: Evidence from Zambian Copper Mines," OxCarre Working Papers 131, Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Maldonado, Stanislao, 2014. "The Non-Monotonic Political Effects of Resource Booms," MPRA Paper 85649, University Library of Munich, Germany, revised 18 Dec 2017.
    2. Traviss Cassidy, 2019. "The Long-Run Effects of Oil Wealth on Development: Evidence from Petroleum Geology," The Economic Journal, Royal Economic Society, vol. 129(623), pages 2745-2778.
    3. Jorge Gallego & Stanislao Maldonado & Lorena Trujillo, 2018. "Blessing a Curse? Institutional Reform and Resource Booms in Colombia," Working Papers 122, Peruvian Economic Association.
    4. Gallego, Jorge & Maldonado, Stanislao & Trujillo, Lorena, 2020. "From curse to blessing? institutional reform and resource booms in Colombia," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 174-193.
    5. Ralph de Haas & Steven Poelhekke, 2016. "Mining Matters: Natural Resource Extraction and Local Business Constraints," CESifo Working Paper Series 6198, CESifo.
    6. Konte, Maty & Vincent, Rose Camille, 2021. "Mining and quality of public services: The role of local governance and decentralization," World Development, Elsevier, vol. 140(C).
    7. Pelzl, Paul & Poelhekke, Steven, 2021. "Good mine, bad mine: Natural resource heterogeneity and Dutch disease in Indonesia," Journal of International Economics, Elsevier, vol. 131(C).
    8. James Cust & Torfinn Harding & Pierre-Louis Vézina, 2019. "Dutch Disease Resistance: Evidence from Indonesian Firms," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 6(6), pages 1205-1237.
    9. Tiago Cavalcanti & Daniel Mata & Frederik Toscani, 2019. "Winning the oil lottery: the impact of natural resource extraction on growth," Journal of Economic Growth, Springer, vol. 24(1), pages 79-115, March.
    10. Waqar Wadho & Sadia Hussain, 2023. "Ethnic diversity, concentration of political power and the curse of natural resources," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 40(1), pages 113-137, April.
    11. Eoin McGuirk, 2013. "The illusory leader: natural resources, taxation and accountability," Public Choice, Springer, vol. 154(3), pages 285-313, March.
    12. Balza, Lenin & De Los Rios, Camilo & Rivera, Nathaly M., 2022. "Digging Deep: Resource Exploitation and Higher Education," IDB Publications (Working Papers) 12451, Inter-American Development Bank.
    13. De Haas, Ralph & Poelhekke, Steven, 2019. "Mining matters: Natural resource extraction and firm-level constraints," Journal of International Economics, Elsevier, vol. 117(C), pages 109-124.
    14. Frederick van der Ploeg, 2011. "Natural Resources: Curse or Blessing?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 366-420, June.
    15. Badeeb, Ramez Abubakr & Lean, Hooi Hooi & Clark, Jeremy, 2017. "The evolution of the natural resource curse thesis: A critical literature survey," Resources Policy, Elsevier, vol. 51(C), pages 123-134.
    16. Gradstein, Mark & Klemp, Marc, 2020. "Natural resource access and local economic growth," European Economic Review, Elsevier, vol. 127(C).
    17. Shakti Mohan TANDI & Prajna Paramita MISHRA, 2020. "Are resources a curse or blessings? Evidence from panel ARDL model," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(623), S), pages 191-204, Summer.
    18. Ofori Adofo,Josephine & Tarui,Nori & Tanaka,Tomomi, 2022. "The Local Economic Effects of Natural Resources : Evidence from Ghana," Policy Research Working Paper Series 10154, The World Bank.
    19. Batdelger, Tuvshintugs & Zagdbazar, Manlaibaatar, 2022. "Does mining improve rural livelihood?: Evidence from Mongolia," Resources Policy, Elsevier, vol. 78(C).
    20. Grant D. Jacobsen, 2019. "Who Wins In An Energy Boom? Evidence From Wage Rates And Housing," Economic Inquiry, Western Economic Association International, vol. 57(1), pages 9-32, January.

    More about this item

    Keywords

    Natural resources; Mining; Pollution;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sfu:sfudps:dp12-08. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Working Paper Coordinator (email available below). General contact details of provider: https://edirc.repec.org/data/desfuca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.