The Relationship between Carbon Dioxide Emissions, Economic Growth and Agricultural Production in Pakistan: An Autoregressive Distributed Lag Analysis

Abstract

This study aims to explore the casual relationship between agricultural production, economic growth and carbon dioxide emissions in Pakistan. An autoregressive distributed lag (ARDL) model is applied to examine the relationship between agricultural production, economic growth and carbon dioxide emissions using time series data from 1960 to 2014. The Augmented Dickey–Fuller (ADF), Phillips–Perron (PP) and Kwiatkowski–Phillips–Schmidt–Shin (KPSS) tests are used to check the stationarity of variables. The results show both short-run and long-run relationships between agricultural production, gross domestic product (GDP) and carbon dioxide emissions in Pakistan. From the short-run estimates, it is found that a 1% increase in barley and sorghum production will decrease carbon dioxide emissions by 3% and 4%, respectively. The pairwise Granger causality test shows unidirectional causality of cotton, milled rice, and sorghum production with carbon dioxide emissions. Due to the aforementioned cause, it is essential to manage the effects of carbon dioxide emissions on agricultural production. Appropriate steps are needed to develop agricultural adaptation policies, improve irrigation facilities and introduce high-yielding and disease-resistant varieties of crops to ensure food security in the country.