Price Effect of Climate Change on Vegetable Crops: Evidence from Tigrai, Northern Most Ethiopia

Abstract

Agriculture economic sector is vital for the main stay of enormous poor people and prime source of food in LDCs yet though negatively impacted by climate change often. That cause production to be low and increase prices thereby affect large staple food consumption to the have-nots more as compared to the rich. The research dealt on the price effect of climate change on vegetables using time series monthly collected data from 2009 to 20015 in Tigrai, Ethiopia. A univariate econometric analysis and finite distributed lag model was employed. As the average temperature increased by 1^oC (degree centigrade) in 2009, caused   the price of tomato vegetable in Tigrai to increase almost more than threefold (310 percent) in 2015. Likewise, in the year 2010 (LD) as the temperature increased by 1^oC, the average price of tomato increased close to 155 percent, ceteris paribus. Even the price of tomato vegetables increased by around 118 percent in 2011(L2D) because of 1^oC increase in the average temperature holding other effects constant. Lastly, in L5D (2013) and L6D (2014) , a 1^oC raise in the average temperature in Tigrai caused  close to 58 percent and 23 percent increase in the price of tomato, ceteris paribus.  The price increase in tomato vegetable is higher than that of the price of potato and onion tuber crops.

So as to get healthy vegetables often at fair prices both by the poor and rich, applying outstanding climate adaptive strategies is decisive in tuning to the new agenda of 21^st Century climate change in many countries of the Globe is recommendable.

Keywords: Climate change, Time Series, Vegetables price, Temperature, Consumption, Tigrai.