Unintended consequences of the quest for increased efficiency in beef cattle: When bigger isn't better. (January 2018)

• Record Type: Journal Article
• Authors: Maples, Joshua G.; Lusk, Jayson L.; Peel, Derrell S.
• Is Part Of: Food policy. Volume 74(2018)
• Page Start: 65
• Page End: 73
• Publication Date: 2018-01
• Subjects: Beef -- Carcass size -- Consumer preferences -- Steak size; Food supply -- Periodicals; Food security -- Periodicals; Food -- Quality -- Periodicals; Food Supply -- Periodicals; Alimentation -- Périodiques; Electronic journals; 338.1905
• DOI: 10.1016/j.foodpol.2017.11.005
• Languages: English
• ISSNs: 0306-9192

Abstract

Highlights: The impact of larger cattle weights on consumer preferences for steaks is quantified. A Latent Class Model is used to estimate consumer preferences and willingness to pay for steak size attributes. Most consumers prefer thicker cut steaks with smaller surface areas over thinner steaks with larger surface areas. Consumer welfare losses occur due to larger steak sizes resulting from larger carcasses. Abstract: Federal funding has long supported the goal of increased beef cattle efficiency. Today, the U.S. produces more beef from fewer cattle due to the ability to get more meat from each animal. Average cattle slaughter weight has increased more than 330 pounds over the past 40 years. While the benefits of this increase in efficiency are well documented, unintended adverse consequences have been less well understood. This article aims to identify and quantify one of these adverse effects. With larger cattle have come larger steaks. In response, many retailers have begun offering thinner cuts to combat high total package prices. But, do consumers prefer larger, thinner steaks or smaller, thicker steaks? Using data from a nationwide survey, this article estimates consumer willingness to pay for beef steak dimensions to draw insights into the consumer welfare changes that have resulted from increasing steak sizes. Results imply that most consumers prefer thicker to thinner cuts steaks and that smaller surface areas are preferred to larger ones. Our estimates suggest that increases in welfare due to larger carcasses, say from lower prices and more ground beef, must offset an $8.6 billion annual loss in consumer welfare resulting from changing steak size.