Abstract
We apply farm-level data to a two-stage model to explore how three different theories of comparative advantage influence the propensity of a farm or ranch to adopt an agritourism enterprise and the level of economic activity tied to that enterprise. Findings suggest that a county’s entrepreneurial spirit and scenic byways increase the propensity to adopt agritourism, but natural endowments and agglomeration are the primary drivers of agritourism economic activity. Results should assist policy makers as well as rural economic development researchers in leveraging community strengths to increase economic activity in the agritourism industry and its surrounding rural economies.
Highlights
Innovation and entrepreneurship are two central drivers of industry growth across regions and markets, but their determinants likely differ depending on the industry
Identifying the firm and locational factors that influence participation and affect performance can assist agricultural operators and economic development professionals in recognizing and leveraging firm- and locationspecific attributes to mitigate market pressures and stimulate innovative growth in their local economies. This analysis fills a gap in the literature by exploring the following research questions with establishment-level data: How do operational characteristics and place-based factors, such as natural amenities, population, and transportation infrastructure relate to the propensity to adopt an agritourism enterprise? And, how does agritourism revenue generated, a proxy for its economic activity, vary by these factors? We explore these questions by comparing three different trade theories that describe how natural endowments (Heckscher-Ohlin factor advantages), farm and operator characteristics (Ricardian productive efficiencies), and agritourism clusters act as pull-factors within the U.S agritourism industry
The proximity to a city of at least 10,000 people, proximity to a National Park Service (NPS) attraction and the county population of an agritourism site are expected to lead to greater agritourism adoption and economic activity tied to agritourism
Summary
Innovation and entrepreneurship are two central drivers of industry growth across regions and markets, but their determinants likely differ depending on the industry. Identifying the firm and locational factors that influence participation and affect performance can assist agricultural operators and economic development professionals in recognizing and leveraging firm- and locationspecific attributes to mitigate market pressures and stimulate innovative growth in their local economies This analysis fills a gap in the literature by exploring the following research questions with establishment-level data: How do operational characteristics and place-based factors, such as natural amenities, population, and transportation infrastructure relate to the propensity to adopt an agritourism enterprise? Understanding how a producer’s location influences the decision to adopt such an enterprise, and further, the expected revenues from their agritourism operation will provide researchers with a more general framework in which to view these previous case studies focused on operator motivations Another branch of literature of particular interest to rural development practitioners is the role of agritourism as an engine of rural economic growth. Results from the empirical analysis suggest that agritourism generally benefits from tourism-oriented industry clusters and that the revenue generated from an operation is dependent on the type of agricultural products produced on the farm or ranch, both of which serve as a potential pull to visitors
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