Climate Change and Agricultural Output in Nigeria: A Nonlinear ARDL and Dynamic Cointegration Analysis

Even though Nigeria's agriculture is susceptible to climate variability, the long-term impact of temperature, rainfall and carbon emissions on agricultural production is still poorly understood. Extant studies are either qualitative or use linear relationships which fail to capture potential asymmetric climate responses. In this study, the authors investigate the long-run and short-run impact of temperature, rainfall and carbon dioxide (CO₂) emissions on agricultural output in Nigeria using annual data for the period 1981-2024. To capture the equilibrium relationship and asymmetry effects, Dynamic Ordinary Least Squares and Fully Modified Ordinary Least Squares as well as Nonlinear Autoregressive Distributed Lag model are used. Results indicate that CO₂ emissions have a positive and significant long-run impact on agricultural production which supports carbon fertilisation hypothesis. By contrast, agricultural output has a strong negative relationship to fertiliser use and population growth, and mixed and statistically insignificant relationships with temperature and rainfall. Significant long run asymmetry is confirmed for temperature and CO₂ emissions using Wald tests. The negative and significant error correction term suggests slow adjustment toward long-run equilibrium suggesting that the impacts of climate on the Nigerian agriculture evolve slowly over time. The evidence suggests that climate change is a significant but subsidiary driver of agricultural performance, and that the climate-agriculture interactions play out over longer time periods through structural processes. The study suggests that it is important to integrate the two types of adaptation investments, namely, sustained adaptation finance with targeted short-term climate interventions, to enhance agricultural resilience.