3.12.2012

Can rainfall explain a HUGE fraction of economic underperformance in Africa since 1980?!

Somehow I missed this when it came out. Review of Economics and Statistics, 2010:

TRENDS IN RAINFALL AND ECONOMIC GROWTH IN AFRICA: A NEGLECTED CAUSE OF THE AFRICAN GROWTH TRAGEDY

Salvador Barrios, Luisito Bertinelli, and Eric Strobl
(earlier working paper here)

Abstract: We examine the role of rainfall trends in poor growth perfor- mance of sub-Saharan African nations relative to other developing coun- tries, using a new cross-country panel climatic data set in an empirical economic growth framework. Our results show that rainfall has been a significant determinant of poor economic growth for African nations but not for other countries. Depending on the benchmark measure of potential rainfall, we estimate that the direct impact under the scenario of no decline in rainfall would have resulted in a reduction of between around 15% and 40% of today’s gap in African GDP per capita relative to the rest of the developing world.


Click to see simulation results.

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