Estimating perennial crop supply response: A methodology literature review

Perennial crops are important both economically and as a component of a healthy and nutritious diet (e.g., many fruits and nuts). However, the study of perennial crop production and farmer response to output price changes (i.e., supply response) is complex thanks to the dynamic nature of investment and decision making in these industries. The body of literature relevant to perennial crop supply response is also small relative to that of annual commodity crops. In this article, we contribute the first literature review on perennial crop supply response modeling in more than 30 years. We catalog advancements in estimating perennial crop supply response and discuss the application of these methods and trade-offs economists should be aware of when using them. In addition, we highlight future modeling developments that may be valuable to the field, with the hope this research will encourage additional economic research on this interesting and important topic and in turn provide new insights for perennial crop producers and policymakers.