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Cow-Calf Producer Risk Preference Impacts on Retained Ownership Strategies


  • Pope, Kelsey Frasier
  • Schroeder, Ted C.
  • Langemeier, Michael R.
  • Herbel, Kevin L.


Considerable efforts have been made to provide cow-calf producers with information to help them make informed decisions about adding value to calves. Despite demonstrated market incentives to retain calves, many producers still sell right after weaning. We postulate this observed behavior is related to producer risk aversion. Our study concludes risk aversion is an important factor affecting calf retention as the most risk-averse producers have more than a 60% probability of selling calves at weaning and the most risk tolerant have less than a 20% probability of selling at weaning.

Suggested Citation

  • Pope, Kelsey Frasier & Schroeder, Ted C. & Langemeier, Michael R. & Herbel, Kevin L., 2011. "Cow-Calf Producer Risk Preference Impacts on Retained Ownership Strategies," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 43(04), November.
  • Handle: RePEc:ags:joaaec:117953

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    References listed on IDEAS

    1. Hodur, Nancy M. & Leistritz, F. Larry & Nudell, Daniel J. & Clark, Clint & Griffith, Duane & Jensen, Tammie, 2007. "Northern Great Plains Beef Production: Production and Marketing Practices of Cow-Calf Producers," Agribusiness & Applied Economics Report 7643, North Dakota State University, Department of Agribusiness and Applied Economics.
    2. Gillespie, Jeffrey M. & Basarir, Aydin & Schupp, Alvin R., 2004. "Beef Producer Choice in Cattle Marketing," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 22(2).
    3. Fausti, Scott W. & Gillespie, Jeffrey M., 2006. "Measuring risk attitude of agricultural producers using a mail survey: how consistent are the methods?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 50(2), June.
    4. Joost M.E. Pennings & Philip Garcia, 2001. "Measuring Producers' Risk Preferences: A Global Risk-Attitude Construct," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(4), pages 993-1009.
    5. Ted C. Schroeder & Allen M. Featherstone, 1990. "Dynamic Marketing and Retention Decisions for Cow-Calf Producers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(4), pages 1028-1040.
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    Cited by:

    1. Tang, Minfeng & Lewis, Karen E. & Griffith, Andrew P. & Boyer, Christopher N., 2016. "Identifying Factors that Impact Returns to Retained Ownership of Cattle," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 229766, Southern Agricultural Economics Association.
    2. Williams, Brian R. & DeVuyst, Eric A. & Peel, Derrell S. & Raper, Kellie Curry, 2014. "The Likelihood of Positive Returns from Value-Added Calf Management Practices," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 46(01), February.
    3. Franken, Jason R.V. & Pennings, Joost M.E. & Garcia, Philip, 2012. "Measuring Risk Attitude and Relation to Marketing Behavior," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124471, Agricultural and Applied Economics Association.
    4. Schumacher, Tucker & Schroeder, Ted C. & Tonsor, Glynn T., 2012. "Willingness-to-Pay for Calf Health Programs and Certification Agents," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(02), May.
    5. Lewis, Karen & Griffith, Andrew & Boyer, Christopher & Rhinehart, Justin, 2015. "Returns to Retained Ownership through Finishing for Beef Cattle Originating from Tennessee," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196620, Southern Agricultural Economics Association.
    6. Gedikoglu, Haluk & Parcell, Joe L., 2014. "Variation of Consumer Preferences Between Domestic and Imported Food: The Case of Artisan Cheese," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), July.
    7. McLeod, Elizabeth & Jensen, Kimberly & Griffith, Andrew & Lewis, Karen, 2017. "Tennessee Beef Producers' Willingness to Participate in a Tennessee Branded Beef Program," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252649, Southern Agricultural Economics Association.
    8. Jason R.V. Franken & Joost M.E. Pennings & Philip Garcia, 2014. "Measuring the effect of risk attitude on marketing behavior," Agricultural Economics, International Association of Agricultural Economists, vol. 45(5), pages 525-535, September.
    9. Holzer, Patrick & Loy, Jens-Peter, 2016. "Messung Des Vermarktungserfolges Bei Marktfruchtbaubetrieben: Wie GroƟ Sind Die Unterschiede?," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 244893, German Association of Agricultural Economists (GEWISOLA).
    10. repec:ags:joaaec:163228 is not listed on IDEAS
    11. Tsakiridis, Andreas & Breen, James & O'Donoghue, Cathal & Hanrahan, Kevin & Wallace, Michael & Crosson, Paul, 2016. "Flexibility of beef suckler cow systems under varying calf retention strategies," 90th Annual Conference, April 4-6, 2016, Warwick University, Coventry, UK 236289, Agricultural Economics Society.

    More about this item


    cow-calf producers; ordered probit; retained ownership; risk aversion; Farm Management; Marketing; Q13; C25; D18;

    JEL classification:

    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection


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