Expanding the phytosanitary exclusion zone for Mexican avocados: Market impacts and unintended consequences

Abstract

Due to phytosanitary concerns, the U.S. has historically only allowed the importation of avocados from one Mexican state—Michoacán. In Michoacán, avocados have become a source of cartel conflict and violence. In August 2022, authorized shipments of avocados from an additional Mexican state – Jalisco – were allowed to enter the U.S. This research investigates the market impacts and unintended consequences of expanding the phytosanitary exclusion zone for Mexican avocados. We find that expansion of the phytosanitary exclusion zone was unequivocally beneficial from the perspective of U.S. avocado users and consumers. However, economic outcomes in the Mexican market are more nuanced, and temporal relationships suggest expansion of the phytosanitary exclusion zone may have affected cartel-related activity both in Michoacán and Jalisco.