Abstract

The declining share of beef in total U.S. meat consumption has motivated industry-wide efforts to improve average beef quality through more effective coordination among the various market participants. Increased use of explicit "grid" pricing mechanisms over the last decade represents initial efforts at improved coordination. More recent efforts include animal-specific carcass data collection, with subsequent transmission to feeders and the relevant cow-calf operations, and improved "source verification" procedures aimed at (among other things) reducing the overall cost of medical treatment for live animals. None of these organizational innovations is costless; indeed, a number of significant barriers must be overcome before such practices can be adopted more widely. In this paper, we take a detailed look at one organization's attempts to overcome some of these barriers and provide an assessment of the costs and benefits of doing so.

Keywords: cattle markets, information transmission, source verification.