The economies of rural america continue to lag those in metropolitan areas with many experiencing significant hardship

The Department of Agriculture National Institute of Food and Agriculture awarded the University of Wisconsin–Madison $591,499 under the Agriculture and Food Research Initiative (AFRI, CFDA 10.310) on June 30, 2026.

The award funds development of a theoretical framework and quantifiable metrics to characterize intermediate economic circularity—the extent to which regions capture a larger share of production and trade activity locally rather than serving as raw material suppliers to distant production centers. The research models economic activity to formalize the concept of intermediate circularity, demonstrates that circularity measures can be calculated using administrative business data and input-output analysis, and estimates causal effects of circularity measures on economic, demographic, and population health outcomes. The analysis addresses potential heterogeneity across extractive versus non-extractive intermediate industries, industry structure, and community sociodemographic characteristics to inform rural development policy. The work responds to USDA's interest in incentivizing reorganization toward circular rural economies and the current absence of rigorous research quantifying the benefits and costs of directing economic development resources toward reshaping production and trade networks.

Performance occurs in Madison, Wisconsin with a period of performance from June 30, 2026 through June 29, 2029.

Policy makers have posited that rural areas may be disadvantaged by their location within the supply-chain as providers of raw and minimally processed intermediate inputs to centers of production located elsewhere. In response, USDA leadership has recently proposed to incentivize a reorganization of economic activity toward a circular economy that would increase the share of economic output used locally. Currently, however, there is a lack of research identifying the potential benefits and costs of directing economic development resources toward reshaping production and trade networks within the united states.a significant challenge to rigorously studying how the spatial distribution of intermediate production and trade affects rural prosperity is the lack of a rigorous theoretical framework that generates quantifiable metrics that characterize the shape of economic activity.therefore, our proposal makes several important contributions to this emerging policy discussion. First, we develop a model of economic activity to formalize the concept of intermediate circularity that allows US to derive a collection of measures that quantify the shape of intermediate production and trade. Second, we demonstrate that these measures can be calculated using administrative business data applying the input-output framework. Third, we estimate the causal effects of these measures of intermediate circularity on economic, demographic, population health outcomes to inform rural development policy, including potential heterogeneity across intermediate industry (extractive versus non-extractive), industry structure, and community sociodemographic attributes.