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No Mangoes in the Tundra: Spatial Heterogeneity in Agricultural Productivity Analysis

Authors


  • We are grateful to Anindya Banerjee, Marco Barassi, Steven Block, Stephen Bond, Marcel Fafchamps, Michael Klein, Rocco Macchiavello, John Muellbauer, Hashem Pesaran, James Reade, Ron Smith, Måns Söderbom, Jon Temple, Joakim Westerlund and two anonymous referees for helpful comments and suggestions. We also thank seminar/session participants at workshops in Oxford, the CSAE Conference, the International Panel Data Conference, the World SEA Congress, Gothenburg, the NEUDC, Brown, Birmingham and the NAPW for their input. All remaining errors are our own. We are indebted to Peter Pedroni and Takashi Yamagata for making their computer code freely available on the Internet. A technical appendix to the paper as well as the data and Stata routines can be found at http://sites.google.com/site/medevecon. The first author gratefully acknowledges financial support from the UK Economic and Social Research Council (grant numbers PTA-031-2004-00345, PTA-026-27-2048), the Bill & Melinda Gates Foundation and the James Baker III Institute for Public Policy at Rice University.

Abstract

In line with the wider macro productivity literature existing studies of agricultural production largely neglect technology heterogeneity, variable time-series properties and the potential for heterogeneous but correlated total factor productivity (TFP) across countries. Our empirical approach accommodates these difficulties and seeks to model the nature of the cross-section dependence in a sample of 128 countries (1961–2002). Our results suggest that agro-climatic environment drives similarity in TFP evolution across countries with heterogeneous production technology. This provides a possible explanation for the failure of technology transfer from advanced countries of the temperate ‘North’ to arid and/or equatorial developing countries of the ‘South’.

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