AN ECONOMIC ANALYSIS OF ANTHROPOGENIC CLIMATE CHANGE ON RICE PRODUCTION IN MALAYSIA

Rice is an important staple food in Malaysia and represents a substantial household expenditure. Malaysia, which imports about 35 percent of its rice, is the 13th largest importer of rice in the world. This makes Malaysia susceptible to global rice crisis, similar to the one in 2008. Climate change is crucial in affecting rice production in tropical countries especially Malaysia as climate projections have shown that climate change will affect countries in the tropics most negatively with increased temperature and flooding due to anthropogenic carbon dioxide emissions. This study analysed the effect of anthropogenic carbon dioxide emissions on rice production in Malaysia during the period 1970-2013. The analysis incorporated the following variables: total local rice production, carbon dioxide emissions, precipitation, land used for paddy farming, total rice imports, and global average crude oil prices. The results indicated that in the estimated model the level of carbon dioxide does not affect rice production in the short- run. However, increased carbon dioxide emissions can influence rice production indirectly by affecting the level of precipitation. Precipitation and area of irrigated land are significant variables in determining level of rice production. Policies for reducing carbon emissions is however crucial for ensuring long run sustainability in rice production.