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Climate Change and the Ethiopian Economy: A Computable General Equilibrium Analysis

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  • Gebreegziabher, Zenebe
  • Stage, Jesper
  • Mekonnen, Alemu
  • Alemu, Atlaw

Abstract

This paper analyses the economic impacts of climate change on Ethiopia’s agriculture using a countrywide computable general equilibrium model. The impacts on agriculture are based on results from a Ricardian model where current (and future) agricultural production is analyzed as a function of temperature and precipitation. We project that the effect of overall climate change will be relatively benign until approximately 2030 and then worsen considerably. Our simulation results indicate that, over a 50-year period, the projected reduction in agricultural productivity may lead to 30 percent less average income, compared with the possible outcome in the absence of climate change. Autonomous adaptations that the farmers make and government policies in response will be crucial for Ethiopia’s future development.

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  • Gebreegziabher, Zenebe & Stage, Jesper & Mekonnen, Alemu & Alemu, Atlaw, 2011. "Climate Change and the Ethiopian Economy: A Computable General Equilibrium Analysis," RFF Working Paper Series dp-11-09-efd, Resources for the Future.
    • Handle: RePEc:rff:dpaper:dp-11-09-efd
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    Cited by:

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    2. Girma Mulugeta Emeru, 2022. "The perception and determinants of agricultural technology adaptation of teff producers to climate change in North Shewa zone, Amhara Regional State, Ethiopia," Cogent Economics & Finance, Taylor & Francis Journals, vol. 10(1), pages 2095766-209, December.
    3. Taye Tesfaye & Diptimayee Nayak, 2023. "Climate Change Adaptation Measures by Farm Households in Gedeo Zone, Ethiopia: An Application of Multivariate Analysis Approach," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(4), pages 3183-3209, April.
    4. Sikha Karki & Paul Burton & Brendan Mackey & Clair Alston-Knox, 2021. "Status and drivers of food insecurity and adaptation responses under a changing climate among smallholder farmers households in Bagmati Province, Nepal," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(10), pages 14642-14665, October.
    5. Guo Ruo & Brhane Weldegebrial & Genet Yohannes & Gebremedhin Yohannes, 2018. "Climate Change Adaptation Practices by Ruminant Livestock Producer of in Hintalo Wajerat District Tigray Regional State, Northern Ethiopia," Biomedical Journal of Scientific & Technical Research, Biomedical Research Network+, LLC, vol. 11(5), pages 8809-8828, December.
    6. Alemu Mekonnen, 2014. "Economic Costs of Climate Change and Climate Finance with a Focus on Africa," Journal of African Economies, Centre for the Study of African Economies, vol. 23(suppl_2), pages 50-82.
    7. Amsalu Woldie Yalew, 2016. "Economy-wide Effects of Climate Change in Ethiopia," EcoMod2016 9750, EcoMod.
    8. Hanadi Taher, 2019. "Climate Change and Economic Growth in Lebanon," International Journal of Energy Economics and Policy, Econjournals, vol. 9(5), pages 20-24.
    9. Jonathan E. Ogbuabor & Emmanuel I. Egwuchukwu, 2017. "The Impact of Climate Change on the Nigerian Economy," International Journal of Energy Economics and Policy, Econjournals, vol. 7(2), pages 217-223.
    10. Steve Bass & Shannon Siyao Wang & Tadele Ferede & Daniel Fikreyesus, 2013. "Making Growth Green and Inclusive: The Case of Ethiopia," OECD Green Growth Papers 2013/7, OECD Publishing.
    11. Melese Mulu Baylie & Csaba Fogarassy, 2021. "Examining the Economic Impacts of Climate Change on Net Crop Income in the Ethiopian Nile Basin: A Ricardian Fixed Effect Approach," Sustainability, MDPI, vol. 13(13), pages 1-16, June.

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    More about this item

    Keywords

    climate change; computable general equilibrium; agriculture; Ethiopia;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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