Crop diseases and how they are managed can have a large impact on agricultural productivity. This paper discusses the effects on agricultural productivity of Verticillium dahliae, a soil borne fungus that is introduced to the soil via infested spinach seeds and that causes subsequent lettuce crops to be afflicted with Verticillium wilt. We use a dynamic structural econometric model of Verticillium wilt management for lettuce crops in Monterey County, California to examine the effects of Verticillium wilt on crop-fumigation decisions and on grower welfare. We also discuss our research on the externalities that arise with renters, and between seed companies and growers due to Verticillium wilt, as these disease-related externalities have important implications for agricultural productivity.
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