Share:


The link between carbon emissions, agricultural output and industrial output: evidence from South Africa

    Mabutho Sibanda   Affiliation
    ; Hlengiwe Ndlela   Affiliation

Abstract

This study seeks to establish the relationship between carbon emissions, agricultural output and industrial output in South Africa. It uses data from 1960 to 2017 based on an annual frequency, giving a total of 58 annual observations. The Autoregressive Distributed Lag technique is employed to estimate the model on a bivariate basis. The evidence shows that carbon emissions are not influenced by agricultural and industrial output. Conversely, agricultural output is influenced by carbon emissions and industrial output. The results suggest that climate change resulting from carbon emissions has led to reduced agricultural output, adversely affecting food security. The significant relationship between industrial and agricultural output suggests that a properly functioning industrial sector will cause an increase in the agricultural output. The study’s findings have implications for climate change and manufacturing policies in South Africa.

Keyword : agricultural output, carbon emissions, climate change, CO2, greenhouse gases, industrialization, industrial output

How to Cite
Sibanda, M., & Ndlela, H. (2020). The link between carbon emissions, agricultural output and industrial output: evidence from South Africa. Journal of Business Economics and Management, 21(2), 301-316. https://doi.org/10.3846/jbem.2020.11408
Published in Issue
Feb 24, 2020
Abstract Views
3353
PDF Downloads
1986
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

References

Agras, J., & Chapman, D. (1999). A dynamic approach to the Environmental Kuznets Curve hypothesis. Ecological Economics, 28(2), 267-277. https://doi.org/10.1016/S0921-8009(98)00040-8

Alam, M. M., Murad, M. W., Noman, A. H. M., & Ozturk, I. (2016). Relationships among carbon emissions, economic growth, energy consumption and population growth: Testing Environmental Kuznets Curve hypothesis for Brazil, China, India and Indonesia. Ecological Indicators, 70, 466-479. https://doi.org/10.1016/j.ecolind.2016.06.043

Altieri, M. A., & Nicholls, C. I. (2017). The adaptation and mitigation potential of traditional agriculture in a changing climate. Climatic Change, 140(1), 33-45. https://doi.org/10.1007/s10584-013-0909-y

Apergis, N., & Ozturk, I. (2015). Testing the Environmental Kuznets Curve hypothesis in Asian countries. Ecological Indicators, 52, 16-22. https://doi.org/10.1016/j.ecolind.2014.11.026

Arshed, N. (2014). A manual for ARDL approach to co-integration. Retrieved from https://nomanarshed.wordpress.com/2014/11/16/a-manual-for-ardl-approach-to-cointegration/

Asumadu-Sarkodie, S., & Owusu, P. A. (2016). The relationship between carbon dioxide and agriculture in Ghana: A comparison of VECM and ARDL model. Environmental Science and Pollution Research, 23(11), 10968-10982. https://doi.org/10.1007/s11356-016-6252-x

Awokuse, T. O., & Xie, R. (2015). Does agriculture really matter for economic growth in developing countries? Canadian Journal of Agricultural Economics/Revue Canadienne d’agroeconomie, 63(1), 77-99. https://doi.org/10.1111/cjag.12038

Bai, Y., Deng, X., Jiang, S., Zhao, Z., & Miao, Y. (2018). Relationship between climate change and lowcarbon agricultural production: A case study in Hebei Province, China. Ecological Indicators, 15, 438-447. https://doi.org/10.1016/j.ecolind.2018.04.003

Begum, R. A., Sohag, K., Abdullah, S. M. S., & Jaafar, M. (2015). CO2 emissions, energy consumption, economic and population growth in Malaysia. Renewable and Sustainable Energy Reviews, 41, 594601. https://doi.org/10.1016/j.rser.2014.07.205

Bennetzen, E. H., Smith, P., & Porter, J. R. (2016). Agricultural production and greenhouse gas emissions from world regions – the major trends over 40 years. Global Environmental Change, 37, 43-55. https://doi.org/10.1016/j.gloenvcha.2015.12.004

Burke, P. J., Shahiduzzaman, M., & Stern, D. I. (2015). Carbon dioxide emissions in the short run: The rate and sources of economic growth matter. Global Environmental Change, 33, 109-121. https://doi.org/10.1016/j.gloenvcha.2015.04.012

Chang, N. (2015). Changing industrial structure to reduce carbon dioxide emissions: a Chinese application. Journal of Cleaner Production, 103, 40-48. https://doi.org/10.1016/j.jclepro.2014.03.003

Chen, W., Gao, P., & He, J. (2004). Impacts of future carbon emission reductions on the Chinese GDP growth. Journal of Tsinghua University (Science and Technology), 44(6), 744-747.

Chen, Y. H. H., & Timilsina, G. R. (2012). Economic implications of reducing carbon emissions from energy use and industrial processes in Brazil. The World Bank, Washington, DC. https://doi.org/10.1596/1813-9450-6135

Clark, M., & Tilman, D. (2017). Comparative analysis of environmental impacts of agricultural production systems, agricultural input efficiency, and food choice. Environmental Research Letters, 12(6), 064016. https://doi.org/10.1088/1748-9326/aa6cd5

Cole, C. V., Duxbury, J., Freney, J., Heinemeyer, O., Minami, K., Mosier, A., Paustian, K., Rosenberg, N., Sampson, N., Sauerbeck, D., & Zhao, Q. (1997). Global estimates of potential mitigation of greenhouse gas emissions by agriculture. Nutrient Cycling in Agroecosystems, 49(1-3), 221-228. https://doi.org/10.1023/A:1009731711346

Cole, V., Cerri, C., Minami, K., Mosier, A., Rosenberg, N., Sauerbeck, D., ... & Heinemeyer, O. (1995). Agricultural options for mitigation of greenhouse gas emissions. In Climate Change (pp. 745-771). Cambridge University Press.

Davis, K. F., Gephart, J. A., Emery, K. A., Leach, A. M., Galloway, J. N., & D’Odorico, P. (2016). Meeting future food demand with current agricultural resources. Global Environmental Change, 39, 125-132. https://doi.org/10.1016/j.gloenvcha.2016.05.004

de Souza, J. P. A. (2015). Evidence of growth complementarity between agriculture and industry in developing countries. Structural Change and Economic Dynamics, 34, 1-18. https://doi.org/10.1016/j.strueco.2015.05.001

Dinda, S. (2004). Environmental Kuznets Curve hypothesis: a survey. Ecological Economics, 49(4), 431455. https://doi.org/10.1016/j.ecolecon.2004.02.011

Du, Q., Zhou, J., Pan, T., Sun, Q., & Wu, M. (2019). Relationship of carbon emissions and economic growth in China’s construction industry. Journal of Cleaner Production, 220, 99-109. https://doi.org/10.1016/j.jclepro.2019.02.123

Fais, B., Sabio, N., & Strachan, N. (2016). The critical role of the industrial sector in reaching long-term emission reduction, energy efficiency and renewable targets. Applied Energy, 162, 699-712. https://doi.org/10.1016/j.apenergy.2015.10.112

Feig, G. T., Joubert, W. R., Mudau, A. E., & Monteiro, P. M. S. (2017). South African carbon observations: CO2 measurements for land, atmosphere and ocean. South African Journal of Science, 113 (11/12), 1-4. https://doi.org/10.17159/sajs.2017/a0237

Friel, S., Dangour, A. D., Garnett, T., Lock, K., Chalabi, Z., Roberts, I., ... & Haines, A. (2009). Public health benefits of strategies to reduce greenhouse-gas emissions: food and agriculture. The Lancet, 374(9706), 2016-2025. https://doi.org/10.1016/S0140-6736(09)61753-0

Follett, R. F. (1993). Global climate change, US agriculture, and carbon dioxide. Journal of Production Agriculture, 6(2), 181-190. https://doi.org/10.2134/jpa1993.0181

Gold, M. V. (2016). Sustainable agriculture: the basics. CRC Press.

Goldbatt. (2018). Agriculture: facts and trends. South Africa. Retrieved from http://awsassets.wwf.org.za/downloads/facts_brochure_mockup_04_b.pdf

Gollin, D., Jedwab, R., & Vollrath, D. (2016). Urbanization with and without industrialization. Journal of Economic Growth, 21(1), 35-70. https://doi.org/10.1007/s10887-015-9121-4

Jebli, M. B., & Youssef, S. B. (2017). The role of renewable energy and agriculture in reducing CO2 emissions: Evidence for North Africa countries. Ecological Indicators, 74, 295-301. https://doi.org/10.1016/j.ecolind.2016.11.032

Kanemoto, K., Moran, D., & Hertwich, E. G. (2016). Mapping the carbon footprint of nations. Environmental Science & Technology, 50(19), 10512-10517. https://doi.org/10.1021/acs.est.6b03227

Keeling, C. D. (1973). Industrial production of carbon dioxide from fossil fuels and limestone. Tellus, 25(2), 174-198. https://doi.org/10.3402/tellusa.v25i2.9652

Kucukvar, M., Cansev, B., Egilmez, G., Onat, N. C., & Samadi, H. (2016). Energy-climate-manufacturing nexus: New insights from the regional and global supply chains of manufacturing industries. Applied Energy, 184, 889-904. https://doi.org/10.1016/j.apenergy.2016.03.068

Kuznets, S. (1955). Economic growth and income inequality. American Economic Review, 45, 1-28.

Li, K., & Lin, B. (2015). Impacts of urbanization and industrialization on energy consumption/CO2 emissions: does the level of development matter? Renewable and Sustainable Energy Reviews, 52, 1107-1122. https://doi.org/10.1016/j.rser.2015.07.185

Li, T., Baležentis, T., Makutėnienė, D., Streimikiene, D., & Kriščiukaitienė, I. (2016). Energy-related CO2 emission in European Union agriculture: Driving forces and possibilities for reduction. Applied Energy, 180, 682-694. https://doi.org/10.1016/j.apenergy.2016.08.031

Liaskas, K., Mavrotas, G., Mandaraka, M., & Diakoulaki, D. (2000). Decomposition of industrial CO2 emissions: The case of the European Union. Energy Economics, 22(4), 383-394. https://doi.org/10.1016/S0140-9883(99)00035-3

Lin, B., & Lei, X. (2015). Carbon emissions reduction in China’s food industry. Energy Policy, 86, 483492. https://doi.org/10.1016/j.enpol.2015.07.030

Lin, B., & Xie, X. (2016). CO2 emissions of China’s food industry: an input-output approach. Journal of Cleaner Production, 112, 1410-1421. https://doi.org/10.1016/j.jclepro.2015.06.119

Liu, L. C., Fan, Y., Wu, G., & Wei, Y. M. (2007). Using the LMDI method to analyze the change of China’s industrial CO2 emissions from final fuel use: An empirical analysis. Energy Policy, 35(11), 5892-5900. https://doi.org/10.1016/j.enpol.2007.07.010

Liu, L. C., Wang, J. N., Wu, G., & Wei, Y. M. (2010). China’s regional carbon emissions change over 1997–2007. International Journal of Energy and Environment, 1(1), 161-176.

Long, X., Luo, Y., Wu, C., & Zhang, J. (2018). The influencing factors of CO2 emission intensity of Chinese agriculture from 1997 to 2014. Environmental Science and Pollution Research, 25(13), 1309313101. https://doi.org/10.1007/s11356-018-1549-6

Ma, X., Wang, C., Dong, B., Gu, G., Chen, R., Li, Y., Zou, H., Zhang, W., & Li, Q. (2019). Carbon emissions from energy consumption in China: Its measurement and driving factors. Science of the Total Environment, 648, 1411-1420. https://doi.org/10.1016/j.scitotenv.2018.08.183

Mi, Z. F., Pan, S. Y., Yu, H., & Wei, Y. M. (2015). Potential impacts of industrial structure on energy consumption and CO2 emission: a case study of Beijing. Journal of Cleaner Production, 103, 455462. https://doi.org/10.1016/j.jclepro.2014.06.011

Moore, F. C., & Diaz, D. B. (2015). Temperature impacts on economic growth warrant stringent mitigation policy. Nature Climate Change, 5(2), 127-131. https://doi.org/10.1038/nclimate2481

Pant, K. P. (2009). Effects of agriculture on climate change: a cross-country study of factors affecting carbon emissions. Journal of Agriculture and Environment, 10, 84-102. https://doi.org/10.3126/aej.v10i0.2134

Pesaran, H. H., & Shin, Y. (1998). Generalized impulse response analysis in linear multivariate models. Economics Letters, 58(1), 17-29. https://doi.org/10.1016/S0165-1765(97)00214-0

Pesaran, M. H., & Pesaran, B. (1997). Working with Microfit 4.0: interactive econometric analysis [Windows version]. Oxford University Press.

Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3), 289-326. https://doi.org/10.1002/jae.616

Sarkodie, S. A., & Strezov, V. (2018). An empirical study of the Environmental Kuznets curve and Environmental Sustainability curve hypothesis for Australia, China, Ghana and the USA. Journal of Cleaner Production, 201, 98-110. https://doi.org/10.1016/j.jclepro.2018.08.039

Sauerbeck, D. R. (2001). CO2 emissions and C sequestration by agriculture–perspectives and limitations. Nutrient Cycling in Agroecosystems, 60(1-3), 253-266. https://doi.org/10.1023/A:1012617516477

Smith, P., Martino, D., Cai, Z., Gwary, D., Janzen, H., Kumar, P., McCarl, B., Ogle, S., O’Mara, F., Rice, C., Scholes, B., Sirotenko, O., Howden, M., McAllister, T., Pan, G., Romanenkov, V., Schneider, U., Towprayoon, S., Wattenbach, M., & Smith, J. (2007). Greenhouse gas mitigation in agriculture. Philosophical Transactions of the Royal Society B: Biological Sciences, 363(1492), 789-813. https://doi.org/10.1098/rstb.2007.2184

Statistics South Africa. (2019). Retrieved from http://www.statssa.gov.za/

Uddin, M. M. M. (2015). Causal relationship between agriculture, industry and services sector for GDP growth in Bangladesh: An Econometric Investigation. Journal of Poverty, Investment and Development, 8, 124-129.

Van Vuuren, D. P., Stehfest, E., Gernaat, D. E., Doelman, J. C., Van den Berg, M., Harmsen, M., ... & Girod, B. (2017). Energy, land-use and greenhouse gas emissions trajectories under a green growth paradigm. Global Environmental Change, 42, 237-250. https://doi.org/10.1016/j.gloenvcha.2016.05.008

Victor, P. A. (2017). Pollution: Economy and environment. London: Routledge. https://doi.org/10.4324/9781315108483

Wang, H., Zhang, R., Liu, M., & Bi, J. (2012). The carbon emissions of Chinese cities. Atmospheric Chemistry and Physics, 12(14), 6197-6206. https://doi.org/10.5194/acp-12-6197-2012

Wang, Z., & Yang, L. (2015). Delinking indicators on regional industry development and carbon emissions: Beijing–Tianjin–Hebei economic band case. Ecological Indicators, 48, 41-48. https://doi.org/10.1016/j.ecolind.2014.07.035

Xu, B., & Lin, B. (2015). How industrialization and urbanization process impacts on CO2 emissions in China: evidence from nonparametric additive regression models. Energy Economics, 48, 188-202. https://doi.org/10.1016/j.eneco.2015.01.005

Xu, S. C., He, Z. X., & Long, R. Y. (2014). Factors that influence carbon emissions due to energy consumption in China: Decomposition analysis using LMDI. Applied Energy, 127, 182-193. https://doi.org/10.1016/j.apenergy.2014.03.093

Xu, S. C., He, Z. X., Long, R. Y., & Chen, H. (2016). Factors that influence carbon emissions due to energy consumption based on different stages and sectors in China. Journal of Cleaner Production, 115, 139-148. https://doi.org/10.1016/j.jclepro.2015.11.050

Zhang, L., Pang, J., Chen, X., & Lu, Z. (2019). Carbon emissions, energy consumption and economic growth: Evidence from the agricultural sector of China’s main grain-producing areas. Science of the Total Environment, 665, 1017-1025. https://doi.org/10.1016/j.scitotenv.2019.02.162