Global and Local Spatial Spill-Overs: What Matters Most for the Diffusion of Organic Agriculture in Australia?

Abstract

Australia has the largest area of certified organic agricultural land in the world, yet to date there has been no studies conducted on its diffusion. This study used local area census data from 2010/11 and 2015/16 across Australia with a SLX Tobit model to investigate what drove a three-fold increase in organic land area during this time-period. Overall, stronger evidence was found for local spatial spill-overs than global spill-overs, which is perhaps reflective of the difference between Australian and European agriculture. The results also found that community area attributes (e.g., larger farms with low stocking rates, higher irrigation, higher grazing and horticultural land, increased labour supply); environmental factors (located in drought affected areas, increased vegetation, good quality soil and high altitude); and socio-economic characteristics (rural areas characterised by low human population density, higher community income and proximity to urban centres) significantly increased the intensity of the diffusion process.