ORGANIZED SYMPOSIUM: PRICE DISCOVERY IN LIVESTOCK MARKETS, WHAT IS THE ROLE OF PUBLIC UNIVERSITIES

Livestock Production/Industries, Research and Development/Tech Change/Emerging Technologies,

THE ROLE OF TRANSACTION COSTS IN MARKET SELECTION: MARKET SELECTION IN COMMERCIAL FEEDER CATTLE OPERATIONS

A survey of commercial feeder cattle operations in Utah revealed that explicit transaction costs such as transportation, shrink, and commissions can not fully explain how marketing alternatives are selected. Implicit transaction costs appear to play a critical role in the determination of market selection. For example, the level of trust between buyer and seller and the socio-economic characteristics of market participants are determinants of which marketing method will be used to sell feeder cattle.Livestock Production/Industries, Marketing,

ARE AGRICULTURAL EXPERIMENT STATION FACULTY SALARIES COMPETITIVELY OR MONOPSONISTICALLY DETERMINED?

Labor and Human Capital, Teaching/Communication/Extension/Profession,

MEAT TRACEABILITY: ARE U. S. CONSUMERS WILLING TO PAY FOR IT?

This article reports the results from a series of laboratory auction markets in which consumers bid on meat characteristics. The characteristics examined include meat traceability (i.e., the ability to trace the retail meat back to the farm or animal or origin), transparency (e.g., knowing that the meat was produced without growth hormones, or knowing the animal was humanely treated), and extra assurances (e.g., extra meat safety assurances). This laboratory study provides non-hypothetical bid data on U. S. consumer preferences for traceability, transparency, and assurances (TTA) in red meat at a time when the U.S. currently lags other countries in development of TTA meat systems. Our results suggest that U.S. consumers would be willing to pay for such TTA meat characteristics, and the magnitude of the consumer bids suggest a likely profitable market for development of U.S. TTA systems.Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,

PRICE ASYMMETRY IN SPATIAL FED CATTLE MARKETS

Price asymmetry in spatial fed cattle markets is investigated for three large markets (Texas Panhandle, Nebraska, and Colorado) and one small market (Utah). Little support is found for the notion that equilibrium prices for fed cattle are asymmetric between locations. However, adjustments to price increases and price decreases occur at different speeds.Demand and Price Analysis, Livestock Production/Industries,

HEDGING CARCASS BEEF TO REDUCE THE SHORT-TERM PRICE RISK OF MEAT PACKERS

Hedging in the live cattle futures market has largely been viewed as a method of reducing producer's price over a rather lengthy production period (three to six months). Meat packers and processors also face price risk. However, packers' and processors' price risk lies on the upside (i.e., risk is due to price increases) and is also relatively short-term (usually a few days). The possibility of reducing packers' and processors' price risk through long-hedging on the live cattle contract for a short period of time (one week) was investigated. The results suggest some potential benefits to meat packers form following a routine hedging strategy.Livestock Production/Industries, Marketing,

A COMPARISON OF PRICING STRUCTURES AT VIDEO AND TRADITIONAL CATTLE AUCTIONS

The number of cattle sold through video auctions has increased dramatically during the past five years. In this study structural differences in pricing between a group of traditional auctions and the nation's largest satellite video cattle auction are examined. A Chow test for structural pricing differences reveals that the influence of lot characteristics, market information, and merchandising strategies on cattle prices are essentially identical at both types of auctions. However, optimal lot size is larger at video auctions than at traditional auctions.Demand and Price Analysis,

MEAT TRACEABILITY: ARE U.S. CONSUMERS WILLING TO PAY FOR IT?

This article reports the results form a series of laboratory auction markets in which consumers bid on meat characteristics. The characteristics examined include meat traceability (i.e., the ability to tract the retail meat back to the farm or animal of hormones, or knowing the animal was humanely treated), and extra assurances (e.g., extra meat safety assurances). This laboratory study provides non-hypothetical bid data on consumer preferences for a sample of consumers in Logan, Utah, for traceability, transparency, and assurances (TTA) in red meat at a time when the United States currently lags other countries in development of TTA meat systems. Results suggest these consumers would be willing to pay for such TTA meat characteristics, and the magnitude of the consumer bids reveals that a profitable market for development of TTA systems in the United States might exist.Consumer/Household Economics,

DYNAMICS OF REGIONAL FED CATTLE PRICES

The dynamic relationship between four regional cash prices for fed (slaughter) cattle is investigated using time series analysis and causality tests. The results indicate that price adjustments to new information take about one week. Texas Panhandle price also was determined to dominate the price discovery process. Regional prices also were found to be interdependent. This suggests that increasing regional meat packer concentration may not grant meat packers increased regional market power in their pricing practices.Demand and Price Analysis, Livestock Production/Industries,

ARE AGRICULTURAL EXPERIMENT STATION FACULTY SALARIES COMPETITIVELY OR MONOPSONISTICALLY DETERMINED?

We examine the determinants of agricultural experiment station faculty salaries and find that productivity pays-as manifest by grantsmanship, publications, and the elicitation of competing offers-with no residual evidence of a negative seniority-salary relationship that could signal university monopsony power. This contrasts with findings in the previous literature on faculty salaries. Moreover, national market salary benchmarks, which may proxy for imperfectly observable productivity, correlate almost one-for-one with individual faculty salaries, with individual deviations from peers' salaries proving essentially random. This evidence is much more consistent with the hypothesis that experiment station faculty salaries are determined in a competitive labor market than with the prevailing wisdom that they are set monopsonistically.Teaching/Communication/Extension/Profession,