Economies of Feedlot Scale, Biosecurity, Investment, and Endemic Livestock Disease, September 2006

Infectious livestock disease creates externalities for proximate animal production enterprises. The distribution of production scale within a region should influence and be influenced by these disease externalities. Taking the distribution of the unit costs of stocking an animal as primitive, we show that an increase in the variance of these unit costs reduces consumer surplus. The effect on producer surplus, total surplus, and animal concentration across feedlots depends on the demand elasticity. A subsidy to smaller herds can reduce social welfare and immiserize the farm sector by increasing the extent of disease. While Nash behavior involves excessive stocking, disease effects can be such that aggregate output declines relative to first-best. Disease externalities can induce more adoption of a cost-reducing technology by larger herds so that animals become more concentrated across herds. For strategic reasons, excess overall adoption of the innovation may occur. Larger herds are also more likely to adopt biosecurity innovations, explaining why larger herds may be less diseased in equilibrium.

A Computer-Aided Decision Support System for Making Locational Decisions, 1990

This report is the product of a first-year research project in the University Transportation Centers Program. This project was carried out by an interdisciplinary research team at The University of Iowa's Public Policy Center. The project developed a computerized system to support decisions on locating facilities that serve rural areas while minimizing transportation costs. The system integrates transportation databases with algorithms that specify efficient locations and allocate demand efficiently to service regions; the results of these algorithms are used interactively by decision makers. The authors developed documentation for the system so that others could apply it to estimate the transportation and route requirements of alternative locations and identify locations that meet certain criteria with the least cost. The system was developed and tested on two transportation-related problems in Iowa, and this report uses these applications to illustrate how the system can be used.