Effects of technological shocks on agricultural productivity and gas emissions: the case of Cerrado

Abstract

Brazilian agribusiness plays a crucial role in the country’s economy, but faces sustainability challenges in production, such as greenhouse gas (GHG) emissions, and regional disparities due to production concentration. To better understand the impacts of technological changes, it is essential to consider the interconnections between sectors and regions, using, for example, computable general equilibrium (CGE) models. This study analyzes the effects of these changes on the economy and GHG emissions in Brazil, using the CGE model of PAEG-Cerrado, with a focus on the Midwestern region of Brazil and agriculture. Thus, the goal of this study was to build an analytical tool called PAEG-Cerrado to provide information to support decisions for sustainable development in the agricultural sector, examining the impacts of productivity gains in both economic and environmental terms. With increased land productivity, there has been growth in GDP and in the well-being of families in the Cerrado area. Regarding the
environment, there has been an increase in CO₂-equivalent emissions, especially in agriculture in some states. In the state of Mato Grosso, the productivity increase resulted in lower emissions in specific sectors, particularly those related to livestock activity. In any case, the need for policies to promote more sustainable production is highlighted. Initiatives such as integrated crop-livestock-forestry systems and incentives for research and innovation are some of the alternatives.