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Description:
We assess the CO<sub>2</sub> fertilization effect on US agriculture using spatially-varying CO<sub>2</sub> 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 CO<sub>2</sub> enrichment experiments that have found important interactions between CO<sub>2</sub> and local environmental conditions in controlled settings. We use three empirical strategies: (i) a panel of CO<sub>2</sub> 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 CO<sub>2</sub> 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 CO<sub>2</sub>