The name is absent

SOUTHERN JOURNAL OF AGRICULTURAL ECONOMICS

THE BEEF COW-CALF ENTERPRISE IN THE GEORGIA PIEDMONT:

A CASE STUDY IN CONSPICUOUS PRODUCTION

Wesley N. Musser, Neil R. Martin, Jr. and James O. Wise

Economists have demonstrated considerable
concern with the appropriateness of profit maxi-
mization as a sole firm objective.¹ Agricultural
economists have adopted suggestions of economic
theorists in writings on production economics; for
example, Heady relaxed the objective of profit
maximization to incorporate preferences for family
consumption and risk aversion [8]. Production
economics research has supported the theoretical
reasoning for multiple firm objectives; in a recent
article, Lin, Dean, and Moore state “.. . empirical
studies explicitly employing the profit maximiza-
tion hypothesis . . . have generally provided results
inconsistent with observed or plausible behavior”
[11, p. 497]. Previous studies incorporating multi-
ple objectives in analysis of agricultural produc-
tion have largely been concerned with the general
theoretical categories suggested by Heady. Lin,
Dean, and Moore considered profit maximization
and risk aversion Ill], Patrick and Eisgruber con-
sidered accumulation of net worth, annual net
income for consumption, leisure, and risk-taking
[141; Hatch, Harmon, and Eidman included eight
similar goals in their analysis [61. These studies
have followed the tradition in micro-economic
theory of separate production and consumption
decision-making. While previous analyses have de-
parted from the perfect knowledge, static basis
of conventional micro-economics, the major inter-
action between production and consumption deci-
sions concerns the level and variability of income
available for consumption.

Current production economics conceptions
can be characterized by Thorstein Veblen’s cri-
tique: “The end of acquisition and accumulation
is conventionally held to be the consumption of
the goods accumulated . . .” [22, p. 35]. As an al-
ternative, Veblen argued that the status or honor
associated with particular economic activities must
be considered; “The motive that lies at the root of
ownership is emulation; . . . The possession of
wealth confers honor, it is an invidious distinction”
[22, p. 35]. A particular topic for which Veblen’s
concepts may be appropriate is the level of the
beef cow-calf enterprise in Georgia. Past studies
on maximum profit farm organization have indi-
cated that beef cows are not competitive with other
enterprises [1, p. 7].² However, beef cattle are
now an important agricultural enterprise in Geor-
gia—cattle and calves have been the third or
fourth largest commodity source of gross farm
income in the 1970’s [20, pp. 54-55]. This paper
explores implications of Veblen’s concepts for the
level of beef cattle production in the Georgia
Piedmont. In particular, the hypothesis that a beef
cattle herd has direct utility to a farm operator,
in addition to its income producing capacity, is
formulated into a multi-objective model of farm
organization. The model is evaluated for a repre-
sentative farm situation.

CONSPICUOUS PRODUCTION
AND BEEF CATTLE HERDS

Veblen’s concepts, as presented in The Theory
of Leisure Class [22], hypothesized that economic

Wesley N. Musser is an assistant professor of agricultural economics, Neil R. Martin, Jr., is an agricultural economist with the
Commodity Economics Division, Economic Research Service, USDA, and James O. Wise is an associate professor of agricul-
tural economics at the University of Georgia.

1 McGuire has an exhaustive survey of literature on critiques of and alternatives to the economic theory of the firm advanced
before 1964 [121.

SResearchforothergeographicalareas—for example, Illinois 1211, Missouri Π01, Nebraska [161, Louisiana 1171, and Texas
171—have also understated the number of cows actually produced.

89

1   2   3   4   >>

More intriguing information