The Cow or the Credit: Causal Relationship Between California Dairy Herd Consolidation and Anaerobic Digesters

ABSTRACT

The California dairy industry has experienced considerable consolidation over the past 30 years. During this period, there has also been substantial technological innovation, implementation of the state's Low Carbon Fuel Standard program, and rapid adoption of anaerobic digesters. This apparent correlation has fueled concerns that anaerobic digesters are causing consolidation. We test for a causal relationship between digesters and consolidation using synthetic differences‐in‐differences. Our findings dispute the theory that digesters are causing consolidation.