This report examines the magnitude of economic change that might accrue to the state of Iowa were it to increase its production of selected fruits and vegetables. The scenario presupposes two things: first, that fruit and vegetable production levels in Iowa increase to satisfy certain levels of existing demand, and second, that all or half of those increments to fruit and vegetable production are directly marketed to Iowa household and business consumers by the actual producers. On net, an increase in the production of fruits and vegetables will have a positive effect on the Iowa economy because much of the state’s fresh fruit and vegetable consumption are based on out-of-state sources. By substituting in-state production for out-of-state purchases, money that otherwise would have left the state remains in the state. Keeping money in the state is desirable because money that leaves the state rarely returns. Money that remains in the state has a stimulative or multiplier effect on the whole economy. We call that kind of economic impact import substitution.
The Economic Impacts of Increased Fruit and Vegetable Production and Consumption in Iowa: Phase II
Leopold Center for Sustainable Agriculture
Ames, IA: Leopold Center for Sustainable Agriculture, Iowa State University
May 01, 2006
Reports and Guides
Agricultural Economic Development, Direct Marketing, Farmers Markets, Local / Regional Food Systems