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Abstract
Economic performance measures of organic and transitioning-to-organic cow–calf
farms are compared with those of non-organic cow–calf farms. A method of matching
samples is used for the comparison, estimating sample average treatment effects for
the subpopulation of the treated. Each organic farm is matched with one non-organic
farm that is involved in the same beef industry segments and farm size classes, and in
the same region. Furthermore, farmer demographic, farming system, and technology
variables are used to identify matches. Bias is reduced by estimating separate weighted
regression functions for the treated and untreated groups. Results suggest that higher
cost of organic production is due primarily to higher capital recovery, taxes and insurance,
and overhead costs. Evidence is found for differences in beef enterprise profitability
by organic status.