with Brent Hueth and Guilherme Rosa
Forthcoming in “Economics of Research and Innovation in Agriculture”
Estimates of productivity growth in the dairy sector attribute as much as half of observed growth to genetic improvement. Our work decomposes total productivity change on Wisconsin dairy farms due to genetics into separate effects for genetic improvement and endogenous selection. Using data from a large sample of Wisconsin dairy farms and national-level data on dairy sire rankings, we find that endogenous selection accounts for as much as 75 percent of the total productivity improvement in our sample. Our results indicate that a large portion of productivity growth in dairy farming can be explained by farmers’ ability to identify and select genetics well suited to their production environment, and not solely the quality of the genetics they choose.