Measuring the effect of land degradation and environmental changes on agricultural production in Somalia with two structural breaks

Purpose – The purpose of this study is to measure the effect of land degradation and the environmental
changes on agricultural productivity in Somalia, as well as the other factors that affect crop production in
Somalia.
Design/methodology/approach – Cobb-Douglas production function assumes crop production as a
dependent variable and land degradation, labor, capital, fertilizer and climate change as the explanatory
variables. In this study time-series data (1962–2017) collected from the Food and Agriculture Organization and
World Development Indicators were used. The unit root of the data was examined using Ng-Perron and the LeeStrazicich methods to explore the unit root property of the breaks. Structural breaks are observed using the
Chow test, and the long-run relationship between the variables is examined using Gregory and Hanssen’s
approach.
Findings – This study found that land degradation and climate change have a negative relationship with
agriculture production in Somalia. Land degradation leads to the decline in agricultural production as the loss
of one hectare of land due the depletion causes agriculture production of Somalia to fall by about five percent.
Climate changes and warming of the environment lead to the reduction of agriculture production. One degree
Celsius rise in the temperature leads to a three percent decline in agricultural production. Capital contributes
immensely to agricultural production as one unit of additional capital raises production by seven percent. The
contribution of labor to agricultural production is limited because of land contraction
Practical implications – Land degradation is a significant contributor to the decline of agricultural
production. As land degradation continues to worsen, rural poverty increases, which in turn causes the rural
migration and the social conflict. The government should develop land improvement programs such as
increasing market orientation of the farmers, encourage private sector engagement in agribusiness and
establish a regulatory framework of the land uses.
Originality/value – This study examines the structure of the time-series and specifies the break periods to
determine when and where significant and sudden changes occurred within land degradation and agricultural
production. The study employs advanced econometric methods, namely, Ng-Perron method and the LeeStrazicich method to test the unit root property of the breaks. It also examines the long-run relationship
between the variables using Gregory and Hanssen’s approach.
Keywords Land degradation, Climate change, Crop production, Structural break
Paper type Research paper