Patterns of State Productivity Growth in the U.S. Farm Sector: Linking State and Aggregate Models

Abstract

This article focuses on agricultural productivity growth at both sector and state levels. It does so in a way that preserves the economic integrity of national and state production accounts. A model accounting for interstate transactions in farm goods links sectorwide and state‐specific measures of total factor productivity growth. An interesting conclusion is that the smooth, persistently positive trend typically observed for farm sector productivity growth masks considerable variation across states and regions. The results also indicate that farm sector productivity growth is wholly a function of productivity trends in the individual states. Interstate shifts in production activity and resource reallocations have had little impact.