From Cow Sellers to Beef Exporters: The Impact of Traceability on Cattle Farmers

Abstract

Increasing Total Factor Productivity in agriculture is crucial to boost economic growth in Latin America, given its comparative advantages. In this paper we evaluate a program that implements a traceability system to electronically identify and track the production cycle of cow herds in small/medium rural enterprises in Argentina. The aim of the program was to enhance their exports to high value markets. Our results suggest that the program was successful. Even in an adverse context for the sector due to discouraging public policies and an intense drought, beneficiaries increased their livestock by 15% and rural skilled employment doubled. Encouraged by the program, the beneficiaries created a cooperative to increase their production scale and social capital and in order to overcome market failures stemming from asymmetric information and coordination problems. The treatment also induced the farmers to improve their sanitation and meat quality standards, which enabled them to export to the EU and thereby increase their profits. They also reported gains in efficiency and risk management.

Keywords: Traceability, cattle farmers, rural technology

JEL Classification: O13, O3