Cattle Cycles

38 Pages Posted: 14 Jul 2000 Last revised: 20 Jul 2010

See all articles by Sherwin Rosen

Sherwin Rosen

University of Chicago (Deceased)

Kevin M. Murphy

University of Chicago; National Bureau of Economic Research (NBER)

José Scheinkman

Columbia University; Princeton University - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: July 1993

Abstract

U.S. beef cattle stocks are among the most periodic time-series in economics. A theory of cattle cycles is constructed, based upon rational breeding stock inventory decisions in the presence of gestation and maturation delays between production and consumption. The low fertility rates of cows and substantial lags between fertility and consumption decisions cause the demographic structure of the herd to respond cyclically to exogenous shocks in demand for beef and in production costs. Known biotechnology of cattle demographics imply sharp numerical benchmarks for the dynamic system that describes the evolution of cattle stock and beef consumption. These compare very closely to structural econometric time-series estimates over the 1875-1990 period and prove that systematic cattle cycles have a wholly rational explanation.

Suggested Citation

Rosen, Sherwin and Murphy, Kevin M. and Scheinkman, José, Cattle Cycles (July 1993). NBER Working Paper No. w4403. Available at SSRN: https://ssrn.com/abstract=227312

Sherwin Rosen

University of Chicago (Deceased)

N/A

Kevin M. Murphy (Contact Author)

University of Chicago ( email )

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National Bureau of Economic Research (NBER)

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José Scheinkman

Columbia University ( email )

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Princeton University - Department of Economics ( email )

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609-258-6419 (Fax)

HOME PAGE: http://www.princeton.edu/~joses

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
United States

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