2008 Reports

Hydroclimatic risk to economic growth in Sub-Saharan Africa

Brown, Casey; Meeks, Robyn; Hunu, Kenneth; Yu, Winston

In order to plan strategies for adaptation to climate change, the current effects of climate on economic growth needs to be understood. This study reviews evidence of climate effects on economic growth and presents original analysis of the effect in Sub-Saharan Africa (SSA). Case studies from the literature demonstrate that historically, climate has had significant and negative effects on household income, agricultural productivity and economic growth in SSA. This study focuses on the effects hydroclimatic variability on economic growth in the countries of SSA. We utilize a new national level precipitation statistic that incorporates spatial and temporal variability within each country. Country level economic growth statistics are analyzed with cross-country and panel regressions. Persistent negative precipitation anomalies (drought) are found to be the most significant climate influence on economic growth. This result is consistent across all model specifications and across several measures of welfare and economic activity. Temperature and precipitation variability show significant effects in some cases. Results imply the consideration of hydroclimatic risks, namely drought, may be the priority concern for adaptation to a changing climate for Sub-Saharan Africa. This conclusion is contrary to the focus of many climate change impact assessments that focus on temperature increases as the primary concern.