Nonetheless, let's assume that more space equals less stress, however nominal the reduction. Today, 80 percent of all eggs produced in the United States are under the UEP welfare label. The upshot, it turns out, is that egg productivity per hen increased. Thus it would seem, at first glance, that welfare improvements–at least with respect to eggs–indeed lead to a boost in production.
But the matter gets more complicated the more you bore into it. Most notably, while productivity per hen increased, overall productivity dropped. The decline was due to the fact that, with bigger cages, farmers with fixed barn space couldn't cram as many hens into a single shed as they once could. Density of production, as one would suspect, pays.
Commenting on this industry-initiated cage expansion, the agricultural economists F. Bailey Norwood and Jayson L. Lusk (whose superb and largely overlooked book Compassion By The Pound summarizes much of the literature on this topic) note how increased space has come at the "expense of farm productivity" and is more a reflection of "a real effort to improve animal welfare, and/or to protect the image of the egg industry" than a quest to boost profits.