The Effect of Rainfall on Economic Growth in Thailand: A Blessing for Poor Provinces

The effect of rainfall changes on economic production

Macro-economic assessments of climate impacts lack an analysis of the distribution of daily rainfall, which can resolve both complex societal impact channels and anthropogenically forced changes^1-6. Here, using a global panel of subnational economic output for 1,554 regions worldwide over the past 40 years, we show that economic growth rates are reduced by increases in the number of wet days and in extreme daily rainfall, in addition to responding nonlinearly to the total annual and to the standardized monthly deviations of rainfall. Furthermore, high-income nations and the services and manufacturing sectors are most strongly hindered by both measures of daily rainfall, complementing previous work that emphasized the beneficial effects of additional total annual rainfall in low-income, agriculturally dependent economies^4,7. By assessing the distribution of rainfall at multiple timescales and the effects on different sectors, we uncover channels through which climatic conditions can affect the economy. These results suggest that anthropogenic intensification of daily rainfall extremes^8-10 will have negative global economic consequences that require further assessment by those who wish to evaluate the costs of anthropogenic climate change.

The effects of carbon emissions, rainfall, temperature, inflation, population, and unemployment on economic growth in Saudi Arabia: An ARDL investigation

OBJECTIVE

While macroeconomic and environmental events affect the overall economic performance of nations, there has not been much research on the effects of important macroeconomic and environmental variables and how these can influence progress. Saudi Arabia's economy relies heavily on its vast reserves of petroleum, natural gas, iron ore, gold, and copper, but its economic growth trajectory has been uneven since the 1990s. This study examines the effects of carbon emissions, rainfall, temperature, inflation, population, and unemployment on economic growth in Saudi Arabia.

METHODS

Annual time series dataset covering the period 1990-2019 has been extracted from the World Bank and General Authority of Meteorology and Environmental Protection, Saudi Arabia. The Autoregressive Distributed Lag (ARDL) approach to cointegration has served to investigate the long-run relationships among the variables. Several time-series diagnostic tests have been conducted on the long-term ARDL model to check its robustness.

RESULTS

Saudi Arabia can still achieve higher economic growth without effectively addressing its unemployment problem as both the variables are found to be highly significantly but positively cointegrated in the long-run ARDL model. While the variable of carbon emissions demonstrated a negative effect on the nation's economic growth, the variables of rainfall and temperate were to some extent cointegrated into the nation's economic growth in negative and positive ways, respectively. Like most other nations the short-run effects of inflation and population on economic growth do vary, but their long-term effects on the same are found to be positive.

CONCLUSIONS

Saudi Arabia can achieve both higher economic growth and lower carbon emissions simultaneously even without effectively addressing the unemployment problem. The nation should utilize modern scientific technologies to annual rainfall losses and to reduce annual temperature in some parts of the country in order to achieve higher economic growth.

Dynamics of the impact of COVID-19 on the economic activity of Peru

BACKGROUND

The COVID-19 virus impacts human health and the world economy, causing in Peru, more than 800 thousand infected and a strong recession expressed in a drop of -12% in its economic growth rate for 2020. In this context, the objective of the study is to analyze the dynamics of the short-term behavior of economic activity, as well as to explain the causal relationships in a Pandemic context based on the basic number of spread (Re) of COVID-19 per day.

METHODS

An Autoregressive Distributed Lags (ARDL) model was used.

RESULTS

A negative and statistically significant impact of the COVID-19 shock was found on the level of economic activity and a long-term Cointegration relationship with an error correction model (CEM), with the expected sign and statistically significant at 1%.

CONCLUSION

The Pandemic has behaved as a systemic shock of supply and aggregate demand at the macroeconomic level, which together have an impact on the recession or level of economic activity. The authors propose changing public health policy from an indiscriminate suppression strategy to a targeted, effective and intelligent mitigation strategy that minimizes the risk of human life costs and socioeconomic costs, in a context of uncertainty about the end of the Pandemic and complemented by economic, fiscal and monetary policies that mitigate the economic recession, considering the underlying structural characteristics of the Peruvian economy.