Econometric analysis of cocoa production and deforestation in Ghana: the role of technological innovations.

摘要

This study examines the effect of deforestation on cocoa output and the effect of increased cocoa output on deforestation for Ghana over the period 1975 to 2005 and the role technological innovations has played in the quest for sustainable co-existence of the cocoa industry and tropical rain forest. Granger Causality Tests and Seemingly Unrelated Regression were performed on the variables of interest. The empirical results of the Granger Causality tests revealed that there is a bi-causal relationship between cocoa output and deforestation. Also, technological innovations Granger-cause cocoa output, but the opposite is not true. Further, there is bi-causal relationship between technological innovations and deforestation. The results of the Seemingly Unrelated Regression indicate that Deforestation, 1 year lag of Technology level employed by government in any nationwide innovation campaign, Technology level employed by government in any nationwide innovation campaign in the current year under consideration and Real producer price of coca had positive significant influence on Cocoa output. However, even though rainfall in the months of May and June which is known to affect fruit formation and development negatively significant influence cocoa output. For the deforestation model, only cocoa output and rainfall were found to be significant. Thus, increase in cocoa output increased deforestation, while increase in the rainfall amount decreased deforestation. An interesting result worth noting in the Seemingly Unrelated Regression model estimates is that technological innovations significantly influenced cocoa output, but does not significantly influenced deforestation. These findings suggested that the technological innovations introduced by the government are more geared toward increased cocoa output than toward the conservation of the forest reserves. These results have policy implications for the conservation of the tropical rain forest. For sustainability purposes, this study recommends intensification. To encourage farmers to do so, the increments of producer price will not always work and so government's technological campaigns and technology subsidies should be strengthened and geared towards intensifications which will ultimately lead to decreases in deforestation. Leaving the choice in the hands of the cocoa farmer to adopt intensification technologies will lead to deforestation since it is easier and cheaper to expand the area under cultivation than employing the technology.