Estimation of World Food Production with Panel Data
2012
Lee, M.H., Korea University at Sejong, Sejong, Republic of Korea | Lee, J.H., IBK Economic Research Institute, Seoul, Republic of Korea | Lee, C.L., Korea University at Sejong, Sejong, Republic of Korea
We estimate the global-level food production function with panel data of 148 countries for 1970~2000. In as much as food crisis is mainly caused by the supply shock and likely to happen on a global or regional scale beyond territories, estimation of global or regional food production function warrants utmost importance in international cooperation to prevent food crises. In this paper we estimate a Cobb-Douglas food production function by applying a fixed-effect model and test whether the coefficient of each explanatory variable is homogeneous among the five regions encompassing the 148 countries. Our findings are as follows: First, except for temperature, all explanatory variables prove to be significantly important to account for the changes in the world's food production. Second, the coefficient for each explanatory variable is different from region to region. Especially, the coefficients for temperature and precipitation appear quite different across regions. It may reflect the fact that some regions are in a more developed stage in agricultural technology and infrastructure than in other regions.
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