Case Study

Unraveling the Reintroduction of Hemp in the United States: A Case Study of the Supply and Demand During the (Re)Birth of an Industry

Jonathan D. Shepherd(a), Rebecca Hill(b), William Snell(a), Tyler Mark(a), Jane Kolodinsky(c) and Hannah Lacasse(c)
(a)University of Kentucky, (b)Colorado State University, (c)University of Vermont

JEL Codes: JEL Codes: Q10, Q11, Q12, Q13
Keywords: Demand, hemp, policy, supply

Publish Date: November 1, 2024

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Abstract

The reintroduction of hemp as a legal enterprise in the United States has been one of the largest-scale exercises in applied agricultural economics in recent history. Hemp has a long and storied past in the United States. The economic forces behind the ups and downs of hemp production, coupled with varying legal status throughout time, make hemp an exciting case study to understand how policy influences the forces of economics. The evolution of this reintroduction provides a real-world opportunity to understand and apply core microeconomic and marketing concepts amid uncertainty and government interventions. This hemp case study explores economic concepts including supply and demand, elasticity, price discovery, government intervention and policy, and agricultural marketing and production contracts on the backdrop of hemp production.

About the Authors: Jonathan D. Shepherd is an Agricultural Extension Specialist at the University of Kentucky (Corresponding Author Email: jdshepherd@uky.edu). Rebecca Hill is an Extension Professor at Colorado State University. William Snell is an Extension Professor and Co-Director of the Kentucky Agricultural Leadership Program at the University of Kentucky. Tyler Mark is a Professor at the University of Kentucky. Jane Kolodinsky is a Faculty Affiliate with Colorado State University and Professor Emerita with the University of Vermont. Hannah Lacasse is a Ph.D. Student of Community Development and Applied Economics at the University of Vermont.

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