Agricultural trade and productivity growth: A state-level analysis

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Drawing upon the conceptual contributions of Woodland, Diewert, and others, and the empirical extensions of Kohli, Harrigan, Trefler, and Gopinath and Roe, we use a translog gross national product (GNP) function to model the agricultural sector at the state level. Then, the agricultural export share is derived as a function of the resource base (factor endowments) and the level of productivity. Data from the US Department of Agriculture, Economic Research Service and Ball, Butault, and Nehring are used to fit the share equation using a fixed-effects model. Results confirm the hypothesis that export production is significantly impacted by differences in the levels productivity and factor supplies, and growth in TFP is key to competitiveness in international markets. To accomplish the objectives of this paper, the next two sections outline the research methods and data used in the study. The results of this analysis will then be discussed, followed by conclusions that include policy implications and limitations of the study.

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American Journal of Agricultural Economics

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