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Optimal Organization of a Statewide Livestock Auction Market System: The Case of Tennessee

Published online by Cambridge University Press:  05 September 2016

Emily A. McClain  and
Dan L. McLemore
Emily A. McClain
Affiliation:
Department of Agricultural Economics, University of Tennessee
Dan L. McLemore
Affiliation:
Department of Agricultural Economics, University of Tennessee
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Abstract

Optimal sizes, number, and locations of Tennessee livestock auction markets were identified as those which minimize the combined costs of assembling and marketing livestock for the state using a separable programming model. The model includes transportation costs, economies of size in market operation, a proxy for reductions in buyers' operating costs attributable to increasing market volumes, and livestock production density, both in and around the state. The model is sufficiently comprehensive and descriptive to be of practical use by policy makers who influence industry change. Results indicate that a reduction in market numbers would lower combined costs.

Keywords

livestock auction marketsassembly costtransportation costeconomies of sizeoptimal sizelocation
Type
Submitted Articles
Information
Journal of Agricultural and Applied Economics , Volume 19 , Issue 2 , December 1987 , pp. 121 - 131
Copyright
Copyright © Southern Agricultural Economics Association 1987

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