Asymmetric climate shocks and economic determinants of livestock in Iran: Evidence from a Nonlinear ARDL approach

Articles in Press

Document Type : Research Paper

Authors

1 Department of Management and Rural Development, Faculty of Agriculture, Shahrekord University, Shahrekord, Iran

2 Department of Animal Sciences, ShK.C., Islamic Azad University, Shahrekord, Iran

10.22124/cjes.2026.9781

Abstract

Livestock production in arid and semi-arid regions, such as Iran, is increasingly susceptible to the dual pressures of climate change and macroeconomic volatility. Despite the growing recognition of climate change as a critical threat to agricultural systems, the nuanced impacts of positive and negative climate shocks have received less attention, particularly in the Middle Eastern context. This study addresses this gap by applying a nonlinear autoregressive distributed lag (NARDL) model to Iranian data spanning 1979–2022, capturing both short- and long-run asymmetric responses of livestock output to climatic and economic variables. The results reveal significant and heterogeneous impacts: livestock production responds positively to expanded credit access in the livestock sector (0.172%) and, counterintuitively, higher interest rates (0.199%), reflecting Iran's unique administered credit market. Climatically, a positive shock in temperature reduces the livestock production index by 1.964% in the long run, whereas a negative shock improves it by 1.260%. A long-run reduction in precipitation lowers production by 0.278%, while increased rainfall shows no statistically significant effect. Crucially, the analysis identifies a robust inverted U-shaped nexus for CO₂ emissions, with a statistically precise turning point at 533.6 megatons (95% CI: 413–676 megatons). Historical data indicate Iran crossed this ecological threshold around 2007, meaning the sector currently operates in an "ecologically inefficient regime" where marginal environmental costs outweigh any initial CO₂ fertilization benefits. Furthermore, short-run dynamics reveal that immediate CO₂ gains are rapidly offset by lagged negative environmental stressors. These findings underscore the necessity of designing asymmetry-driven, context-specific policies, such as parametric weather-indexed insurance and shock-activated credit facilities, to build resilient livestock systems in vulnerable regions.

Keywords

Caspian Journal of Environmental Sciences

Articles in Press, Corrected Proof
Available Online from 25 July 2026

Files

Share

How to cite

Statistics