Metin Çakır, PhD, Austin A. Dowell Professor of Applied Economics at the University of Minnesota, will present the EEEP Seminar Series, “California Drought, Fresh Fruit and Vegetable Prices, and Consumer Welfare” on April 29, 2026.
Abstract:
The economic impacts of extreme weather events have become a pressing policy concern as both their frequency and intensity continue to rise. This paper examines how recurrent droughts in California—America’s leading producer of fruits and vegetables—affect retail prices of fresh fruits and vegetables (FFV) across major U.S. metropolitan markets. Using data from 2009 to 2022, Dr. Metin Çakır constructed a novel set of share-weighted drought indices that capture the geographic concentration of FFV production within California and match these indices to scanner-level retail price data from major metropolitan statistical areas. The results reveal a nuanced relationship between drought severity and FFV prices: while mild and moderate droughts have negligible or even negative effects, extreme and exceptional droughts significantly increase retail prices, particularly for vegetables. Mechanism analyses indicate that these price effects are driven by reductions in domestic production—especially for crops heavily dependent on California—rather than by changes in import flows. A compensating-variation analysis shows that welfare losses to consumers are statistically significant but economically modest. Overall, the findings highlight the vulnerability of national food prices to regional climate shocks and underscore the importance of developing climate-resilient agricultural systems and supply chains.
Bio:
Metin Çakır is the Austin A. Dowell Professor of Applied Economics in the Department of Applied Economics at the University of Minnesota. His research focuses on the industrial organization of food and agricultural markets and consumer economics. He teaches courses in microeconomic theory, business strategy, consumer economics, and industrial organization. His work has been published in leading journals, including the American Journal of Agricultural Economics, Journal of Retailing, and Food Policy. His research has received several awards, including the Quality of Research Discovery Award from the Agricultural & Applied Economics Association (AAEA). Dr. Çakır is an active member of the AAEA and has served in multiple roles within the Association. He previously served as an Area Editor for the Journal of the Agricultural and Applied Economics Association and currently serves as a Co-Editor of the American Journal of Agricultural Economics.