Economic Impact of Organic Agriculture Hotspots in the United States

Abstract

After identifying organic agriculture hotspots using spatial statistics, we estimate a treatment effects model that classifies a county’s membership in an organic hotspot as an endogenous treatment variable. We find that organic hotspot membership leads to a lower county-level poverty rate and a higher median household income. A similar result is not found when investigating the impact of general agriculture hotspots. On the other hand, our result is robust to alternative hotspot definitions based on type of organic operations to alternative methods of estimating average treatment effects on the treated.

Keywords: Organic agriculture, hotspots, Local Moran’s I, treatment effects

JEL Classification: Q10, Q18, R11