Environmental Drivers of Agricultural Productivity Growth: CO2 Fertilization of US Field Crops

We assess the CO2 fertilization effect on US agriculture using spatially-varying CO2 data from NASA's Orbiting Carbon Observatory-2 (OCO-2) satellite covering the majority of US cropland under actual growing conditions. This study complements the many CO2 enrichment experiments that have found important interactions between CO2 and local environmental conditions in controlled settings. We use three empirical strategies: (i) a panel of CO2 anomalies and county yields, (ii) a panel of spatial first-differences between neighboring counties, and (iii) a cross-sectional spatial first-difference. We find consistently high fertilization effects: a 1 ppm increase in CO2 equates to a 0.5%, 0.6%, and 0.8% yield increase for corn, soybeans, and wheat, respectively. Viewed retrospectively, 10%, 30%, and 40% of each crop's yield improvements since 1940 are attributable to rising CO2.