The impacts of economic globalization on agricultural value added in developing countries

Extreme risk spillovers between US and Chinese agricultural futures markets in crises: A dependence-switching copula-CoVaR model

The linkages between the US and China, the world's two major agricultural powers, have brought great uncertainty to the global food markets. Inspired by these, this paper examines the extreme risk spillovers between US and Chinese agricultural futures markets during significant crises. We use a copula-conditional value at risk (CoVaR) model with Markov-switching regimes to capture the tail dependence in their pair markets. The study covers the period from January 2006 to December 2022 and identifies two distinct dependence regimes (stable and crisis periods). Moreover, we find significant and asymmetric upside/downside extreme risk spillovers between the US and Chinese markets, which are highly volatile in crises. Additionally, the impact of international capital flows (the financial channel) on risk spillovers is particularly pronounced during the global financial crisis. During the period of the COVID-19 pandemic and the Russia-Ukraine 2022 war, the impact of supply chain disruptions (the non-financial channel) is highlighted. Our findings provide a theoretical reference for monitoring the co-movements in agricultural futures markets and practical insights for managing investment portfolios and enhancing food market stability during crises.

Drivers linking farmers' decision-making with farm performance: A systematic review and future research agenda

A strong aptitude for making sound decisions on a farm is closely linked to favorable farm outcomes, and this finding has been observed across diverse types of farm businesses and geographic locations. Traditionally, research in farm management has addressed the drivers of decision-making and performance as separate entities; however, this article presents novel evidence on the relationship between farmers' decision-making and farm performance. We also examine this association in various contexts of farm decision-making, spanning the past decade. Our comprehensive review encompasses 24 empirical studies conducted in accordance with the preferred reporting items for systematic reviews and meta-analyses (PRISMA) guidelines. The analysis focuses on research topics, performance measures, and methodological perspectives. The findings reveal seven key research topics: farmers' management capacity; the influence of management and farm structure; farmers' emotional attachment to their businesses; personal aspects, farm characteristics, and institutional settings; the significance of farm recordkeeping; joint decisions in farm decision-making processes; and rational inefficiencies in farm decisions. Most studies employed conventional farm performance measures, including financial indicators, technical efficiency, and productivity indicators. Existing studies have predominantly used quantitative methodologies. We also identified research gaps and provide suggestions for future investigations in this field. Our results underscore the pivotal role of decision-making ability in shaping farmers' managerial capacity and, consequently, farm performance.

Impact of economic globalisation on value-added agriculture, globally

Economic globalisation is the integration of national economies into the global economy through the increasing flow of goods, services, capital, and technology across borders and it has contributed to garnering a significant portion of most nations' national income, although its agricultural value-added aspect has yet to be maximised. This pioneering study explores the impact of economic globalisation on value-added agriculture in a global context based on countries' income levels. Panel data regression with the stepwise method was employed to quantify the impact of economic globalization on agriculture value added in 101 countries between 2000 and 2021. The findings of our study reveal that economic globalisation, through various channels such as fertilizer consumption, employment in agriculture, agriculture raw materials export and import, exchange rate, and foreign direct investment, significantly influences the agricultural value-added factor globally and across different income levels. Furthermore, the results show that agricultural employment significantly impacts the agricultural value-added factor globally and across all income levels. Also, countries with low and lower-middle-income levels significantly affect agricultural value-added due to exchange rates. In comparison, high-income and lower-middle-income levels have an impact due to foreign direct investment. Finally, the upper-middle-income countries have significantly affected agricultural value-added due to agricultural raw materials imports. This study confirms that employment in agriculture, exchange rate and foreign direct investments positively impact agriculture value-added on the global level and based on the income level of countries.

An empirical assessment of the tripartite nexus between environmental pollution, economic growth, and agricultural production in Sub-Saharan African countries

A lot of attention has been paid to environmental pollution worldwide, due to the increase in anthropogenic activities. Massive investment in non-renewable energy options raises questions regarding environmental sustainability and how to maximize food and non-food output while still preserving a healthy ecosystem. To this end, the present study explores the three-way nexus between economic growth, CO₂ emission, and agriculture-value added will accounting for other control variables across a balanced panel of selected African economies from 1997 to 2020. Panel econometrics method of the generalized method of moments (two-step difference GMM) is used to obtain a robust result. From the present study, the environmental pollution model shows that economic growth significantly contributes to environmental pollution in Africa. Additionally, the food price index, capital, and FDI promote pollution, while agricultural production and labor decrease pollution. In the case of the economic growth model, the findings reveal that environmental pollution supports the growth-led pollution hypothesis. Also, the food price index and capital ameliorate economic growth, while foreign direct investments decrease economic growth. Finally, the agricultural production model indicates that economic growth increases agricultural production when the interaction term between GDPC and FDI is included in the model. In summary, the combination of explanatory variables, environmental pollution, capital, and foreign direct investment decreases agricultural production. On the contrary, the food price index and labor promote agricultural production in Africa. Furthermore, the study provides a lot of policies for authorities and stakeholders in Sub-Saharan African countries and other developing economies.

Does domestic migration adversely affect food security? Evidence from Vietnam

With a population of more than 100 million as of December 2022, food security remains a persistent challenge in Vietnam despite achieving a miracle of economic growth and social transformation in recent decades. Vietnam has also experienced a significant migration from rural areas into urban cities such as Ho Chi Minh City, Binh Duong, Dong Nai and Ba Ria - Vung Tau. The effects of domestic migration on food security have largely been neglected in the existing literature, particularly in Vietnam. This study investigates the impacts of domestic migration on food security using data from the Vietnam Household Living Standard Surveys. Food security is proxied by three dimensions: food expenditure, calorie consumption, and food diversity. The difference-in-difference and instrumental variable estimation techniques are used in this study to address endogeneity and selection bias. The empirical results reveal that domestic migration in Vietnam increases food expenditure and calorie consumption. We also find significant effects of wage, land and family characteristics such as education level and the number of family members on food security when different food groups are considered. Regional income, household headship and the number of children in a family mediate the relationship between domestic migration and food security in Vietnam.

Deliver Smart, Not More! Building Economically Sustainable Competitiveness on the Ground of High Agri-Food Trade Specialization in the EU

Competitiveness has always been a multifaceted illusive concept, which has made it a real challenge for scholars and practitioners to find the most suitable measurement tools to completely encapsulate all the complex nuances of competitiveness. This becomes even more of a challenge when approached in relation to particular economic sectors. The agri-food sector is no exception, especially when considering all its interconnections with the other sectors: water, energy, transport, waste. All of them impact the achievement of the Sustainable Development Goals (SDGs). Similarly, scholars have been debating the meaning of sustainability for decades, some even arguing that it is a political, subjective, and, in some cases, self-contradictory concept. As far as the sustainability of agricultural competitiveness is concerned, the literature is still developing. It is much more focused on fostering environmental competitiveness, and less attention was paid to the strategies designed to capitalize on sustainable economic competitiveness-a concept that has attracted divergent opinions in the literature, mainly due to ambiguity. Thus, instead of falling into the pitfall of vagueness, this paper was aimed at bringing its contribution to this field by undertaking the research objective of exploring a single facet of sustainable agricultural competitiveness: the economic facet. Hence, this paper proposes the construction of the sustainable economic competitiveness index (SECI) with direct application for agri-food value chains. It consists of three attributes: (a) factor endowments, resource independence; (b) agricultural chain performance; and (c) national agricultural chain strategies and policies. In this study, SECI was tested against the cereal chain for a selection of EU countries, based on the data taken over from FAOSTAT and INTRACEN Trade Map, in the case of the 2011-2020 period. Various statistical and econometric methods were used to test the robustness of SECI. Results stand as proof that building sustainable agricultural economic competitiveness relies on a mix of strategic actions. The key vector in this mix is that trade flow patterns and policies must be calibrated in accordance with national factor endowments in order to achieve high levels of SECI. To add more managerial implications, this paper argues for the smart delivery of agri-food products with high added value instead of focusing on exporting big volumes of raw agricultural materials with little added value.

How to improve agricultural value-added in the MENA region? Implementation of Diamond Porter's theory in agriculture

The global economy in recent decades has experienced frequent shocks. Many regions must improve their competitiveness and value-added to deal with this. One of them is in the Middle East and North Africa (MENA), where a rise in agricultural value-added (AVA) can produce more jobs than in other sectors. It is necessary to consider increasing AVA in the MENA region. Hence, the aim of this study is identifying the determinant factors of AVA in the MENA region. We employed 13 countries in the MENA region as samples in this study. The study's data spans 45 years, from 1975 to 2019. Static panel data regression analysis was employed in this study. AVA can growth by increasing the irrigated land, credit, and human capital. Meanwhile, growing inflation and economic globalization will reduce AVA. Therefore, we recommend that countries in the MENA region have to increase irrigation infrastructure, expand agricultural credit availability, encourage farmers to get a good education, improve research and development, control inflation, and find the best way to implement economic globalization.

Global Challenges and Responses: Agriculture, Economic Globalization, and Environmental Sustainability in Central Asia

Economic globalization (EG) accelerates very fast in Central Asia. This could cause environmental degradation, according to the environmental Kuznets curve (EKC) hypothesis. The study aims to determine how the EG of agriculture impacts environmental sustainability, and to test the EKC hypothesis on the agricultural sector in six Central Asian countries. Particularly, some main hypotheses were proposed using secondary data from Kazakhstan, Kyrgyzstan, Mongolia, Tajikistan, Turkmenistan, and Uzbekistan from 1994 to 2019. This study uses five explanatory variables: agricultural exports value (EXP), agriculture forestry and fishing value-added (AVA), the exchange rate (EXR), total natural resource rents (RENT), and external debt stocks (DEBT), while the dependent variable in this study is the CO2 emissions from on-farm energy use (EMS), temperature changes (TEMP), and forest fires (FIRE). These data are analyzed using panel data regression. As a result, AVA and RENT raise EMS; EXC raises TEMP but lowers EMS; DEBT raises TEMP but can lower FIRE. Hence, we propose recommendations to improve this condition, including a clear roadmap, enhanced partnerships, and regional and international support.

The Importance of Global Value Chains in Developing Countries’ Agricultural Trade Development

The role of global value-added chains is growing in international trade. The development gap between highly developed economies and developing countries means that the only products with which less developed economies can compete on the international arena are agricultural products. Moreover, integration into global value-added chains is an important factor in achieving comparative advantages in trade and improving export competitiveness. The main aim of this article is to assess the impact of integration within global value chains on changes in the comparative advantage of developing countries in the global agricultural trade. The degree of participation of developing countries in global value chains (GVC) was assessed using data from the Trade in Value-added OECD–WTO database (November 2021 edition) by calculating domestic (DVA), foreign value-added (FVA), and revealed comparative advantage (RCA) indexes. The analysis covers the period 1995–2018 and 28 developing economies. The research showed that the foreign value added in the gross exports of agricultural commodities of developing countries was an important factor in strengthening their export position and the importance of integration within global value chains rises with increasing product complexity. In agricultural production, FVA in most developing countries does not have a significant impact on the shaping of the comparative advantage.