Nexus between environmental development and agricultural productivity: A study of inclusive sustainable development...

Brazil, endowed with agricultural resources and a significant ecological footprint, stands at the crossroads of economic dependence on agriculture and climate vulnerability. Named among the leading agricultural producers globally as well as leading global carbon emitters, understanding the dynamics between agricultural productivity and carbon emissions is economically and ecologically relevant. The study employed machine learning regression techniques -ridge, elastic-net, and kernel-regularized least square regression -to assess the nexus between agricultural production and carbon emissions in Brazil in a bi-directional context, amidst socioeconomic players like income per capita, financial inclusion, clean energy use, technological innovations, and institutional quality. The novelty of this paper is edged on the inclusive approach to understanding the complex interaction between agricultural expansion and climate risks, with policy recommendations to mitigate the identified constraints to agricultural development in Brazil. The findings suggested that economic expansion, agricultural production, and financial inclusion are key factors that bolster carbon emissions at 0.32%, 0.77%, and 0.001%, respectively, especially in high-yield regions. This study highlights the emission-intensive nature of Brazil's development trajectory. The result also suggests that on average atmospheric CO₂ enhances agricultural yields at 0.96% and 1.1% each, which validates the CO₂ fertilization theory. This may be offset in the long run by environmental pressure given sustained CO₂ emissions. Technological innovation and clean energy are seen to be effective drivers to decouple agricultural expansion from environmental risks at 0.002% and 0.02%, respectively, in Brazil, and this is consistent with existing arguments. However, the effect of institutional/regulatory frameworks on both agricultural production and environmental quality is seen to be heterogenous with respect to regional peculiarities. Specifically, institutional quality shows the ability to enhance environmental development by reducing carbon emissions by 0.03%. The results highlighted the need for policies that foster the adoption of climate-resilient agricultural land management practices and control of emissions to ensure Brazil's agricultural sector is a driver of inclusive and low-carbon growth. It also points to the need for green finance integration to foster innovation and accelerate clean energy technology adoption and diffusion.