Reflections on development financing

This article sets forth some reflections on the position of the region's countries and the different segments of their domestic financial structures in the international financial system. In the light of the financial globalization taking place in Latin America, it considers the circumstances of the largest countries in the region, looking beyond the stylized arguments of conventional wisdom to analyse different factors influencing the financial situation: sovereignty risk, financial globalization, the degree of financial integration, the cost of capital and the burden of country risk premiums, the link between sovereign risk and fiscal solvency and the consequences of segmented integration. Consideration is then given to courses of action that could reduce country risk. In addition, the role of the different institutional sectors in generating savings is analysed, and the main trends of financial intermediation in the region are considered: banking concentration, the increased involvement of foreign organizations and the role of the public-sector banking system in the circumstances that now prevail.

An analysis of maritime transport and its costs for the Caribbean

Includes bibliography

Capital flows to Latin America: recent developments

The external environment has deteriorated sharply as a result of the spiraling financial turmoil, and has led to a weakening in commodity prices and fears of a worldwide recession. Latin America and the Caribbean's fastest expansion in 40 years may be threatened as the global credit crunch makes financing scarce and squeezes demand for the region's commodities. This time around the region is better positioned to weather the crisis than in the past, given improvements in macroeconomic and financial policies as well as a reduced net dependency on external capital inflows. However, Latin American markets are feeling the effects of the crisis through a slowdown in capital inflows, large declines in stock price indexes, significant currency adjustments and an increase in debt spreads. Volatility has soared, with the closely watched Chicago Board Options Exchange Volatility Index moving to an all-time high of 70.33 on October 17, indicating that fear (rather than greed) has been ruling the markets.After reaching record lows in May 2007, emerging markets bond spreads are now above pre-Asian crisis levels. The JPMorgan EMBI+ Latin American composite widened by 146 basis points in the third quarter, with spreads reaching 448 basis points at the end of September. Spreads have widened sharply in recent weeks as foreign investors cut back regional exposure for the safety of U.S. Treasuries. The ongoing lack of liquidity and subsequent liquidation of assets is leading to a collapse in asset prices and a sharp widening in spreads. Daily spreads in October have risen to levels not seen since December 2002, making it much more difficult for governments that need financing to get it. Risk premiums for Latin corporates and sovereigns have risen substantially, but have remained well below U.S. junk (high-yield) bonds. Latin corporates are facing a steep rise in foreign exchange borrowing costs (although less than firms in other emerging markets), which raises concerns that refinancing risks will climb.So far, emerging markets vulnerabilities have been more focused on corporates, as sovereigns have improved public debt dynamics and countries' financing needs are under control. Market performance has been driven by the rapid deterioration of emerging markets bank and corporate market, as well as ongoing losses in emerging markets equities. From January to September 2008, the Morgan Stanley Capital International (MSCI) Latin American Index lost almost 28%, while the Emerging Markets Index lost 37% and the G-7 Index lost 24%. While in 2007 the Latin America component gained 47%, almost nine times as much as the MSCI-G7 index for developed markets, since mid-September 2008 stocks in Latin America have been doing worse than stocks in developed countries, as concerns about access to credit and the adverse impact of sharp falls in commodity prices and in local currencies contribute to increased risk aversion and to outflows of capital. Many governments in the region have used revenue from the commodity boom to pay down debt and build reserves. Now, facing a global financial crisis and the threat of recession in developed countries, the biggest question for Latin America is how long and deep this cyclical downturn will be, and how much it is going to reduce commodity prices. Prices for commodities such as soy, gold, copper and oil, which helped fund the region's boom, have fallen 28% since their July 2 high, according to the RJ/CRB Commodity Price Index. According to Morgan Stanley (in a September 29 report), should prices return to their 10-year average, Latin America's balanced budgets would quickly revert to a deficit of 4.1% of GDP. As risk aversion increases, investors are rapidly pulling out massive amounts of money, creating problems for local markets and banks. There is an ongoing shortage of dollars (as investors liquidate assets in Latin American markets), and as currencies depreciate, inflation concerns increase despite the global slowdown. In Brazil and Mexico, central banks deployed billions of dollars of reserves to stem steep currency declines, as companies in these countries, believing their local currencies would continue to strengthen against the U.S. dollar, took debts in dollars. Some companies also made bets using currency derivatives that have led to losses in the billions of dollars. Dramatic currency swings have caused heavy losses for many companies, from Mexico's cement giant Cemex SAB to the Brazilian conglomerate Grupo Votorantim. Mexico's third-largest retailer, Controladora Comercial Mexicana, declared bankruptcy recently after reporting huge losses related to exchange rate bets. As concerns about corporate exposure to dollar-denominated derivatives increases, yields on bonds issued by many of Brazil's and Mexico's leading companies have started to rise, sharply raising the cost of issuing new debt. Latin American external debt issuance came to a halt in the third quarter of 2008, totaling only US$ 690 million. The cost of obtaining loans for capital expenditures, M&A and debt refinancing is also rising substantially for Latin American corporates amid contagion from the U.S. financial crisis. According to bankers, a protracted trend of shortening tenors and widening spreads has intensified in the past few weeks, indicating that bank lending is quickly following the way of bonds and equity. Finally, money transfers from Latin American migrants are expected to decline for the first time this decade, as a result of economic downturns in the U.S. and Spain, inflation and a weaker dollar. The Mexican Central Bank announced that money transfers from Mexicans living in the U.S. dropped a record 12.2% in August. In 2008, migrants from the region will send some 1.7% less in remittances year-on-year when adjusted for inflation, according to the IADB, compounding the adverse effects of the deepening financial turmoil.

Jamaica: Employer size and worker remuneration in the private sector

Includes bibliography.

An assessment of the economic and social impacts of climate change on the tourism sector in the Caribbean

There are significant, fundamental changes taking place in global air and sea surface temperatures and sea levels. The Fourth Assessment Report of the Intergovernmental Panel on Climate Change noted that many of the warmest years on the instrumental record of global surface temperatures have occurred within the last twelve years, i.e. 1995-2006 (IPCC, 2007). The Caribbean tourism product is particularly vulnerable to climate change. On the demand side, mitigation measures in other countries – for example, measures to reduce the consumption of fossil fuels – could have implications for airfares and cruise prices and, therefore, for the demand for travel, particularly to long-haul destinations such as the Caribbean (Clayton, 2009). On the supply side, sea level rise will cause beaches to disappear and damage coastal resorts. Changes in the frequency and severity of hurricanes are likely to magnify that damage. Other indirect impacts on the tourism product include rising insurance premiums and competition for water resources (Cashman, Cumberbatch, & Moore, 2012). The present report has used information on historic and future Caribbean climate data to calculate that the Caribbean tourism climatic index (TCI) ranges from −20 (impossible) to +100 (ideal). In addition to projections for the Caribbean, the report has produced TCI projections for the New York City area (specifically, Central Park), which have been used as comparators for Caribbean country projections. The conditions in the source market provide a benchmark against which visitors may judge their experience in the tourism destination. The historical and forecasted TCIs for the Caribbean under both the A2 and B2 climate scenarios of the IPCC suggest that climatic conditions in the Caribbean are expected to deteriorate, and are likely to become less conducive to tourism. More specifically, the greatest decline in the TCI is likely to occur during the northern hemisphere summer months from May to September. At the same time, the scenario analysis indicates that home conditions during the traditional tourist season (December – April) are likely to improve, which could make it more attractive for visitors from these markets to consider ‘staycations’ as an alternative to overseas trips.

EC28-234 Nebraska System for Tattooing Hogs for Identification after Slaughter

A plan to identify the individual farm upon which hogs reaching markets are produced has been developed in connection with the efforts toward eradicating tuberculosis among farm animals. While primarily intended as a means of tracing back to determine sources of disease infection, the system of tattooing which is being developed has other significant possibilities. With the growing emphasis on quality products in the market, it is only fair that the producers of high quality commodities receive the premiums paid by processors and consumers. Health of farm animals is a quality factor. The producer of healthy hogs should be rewarded. Likewise, the producer of diseased hogs profits from knowledge that his animals are infected and can institute efforts to control that source fo loss. This 1928 extension circular covers what each letter of a tattoo stands for, where it is to be placed on an animal, and material used in tattooing.

INSURANCE

We have been working with exterminators on the insurance problems for thirty-five or so years. Recently PCO’s have been doing much in the way of bird control. There does not seem to be anyone that we know of who does strictly bird control insurance, so our group always ties it in with our pest control. I feel that nothing touches everyone so regularly, with the exception of the federal government, as your insurance premiums. I would like to discuss with you the causes and results of accidents and how they can effect insurance premiums.

Learning for well being : Studies using the International Adult Literacy Survey

This thesis is a collection of five independent but closely related studies. The overall purpose is to approach the analysis of learning outcomes from a perspective that combines three major elements, namely lifelonglifewide learning, human capital, and the benefits of learning. The approach is based on an interdisciplinary perspective of the human capital paradigm. It considers the multiple learning contexts that are responsible for the development of embodied potential – including formal, nonformal and informal learning – and the multiple outcomes – including knowledge, skills, economic, social and others– that result from learning. The studies also seek to examine the extent and relative influence of learning in different contexts on the formation of embodied potential and how in turn that affects economic and social well being. The first study combines the three major elements, lifelonglifewide learning, human capital, and the benefits of learning into one common conceptual framework. This study forms a common basis for the four empirical studies that follow. All four empirical studies use data from the International Adult Literacy Survey (IALS) to investigate the relationships among the major elements of the conceptual framework presented in the first study. Study I. A conceptual framework for the analysis of learning outcomes This study brings together some key concepts and theories that are relevant for the analysis of learning outcomes. Many of the concepts and theories have emerged from varied disciplines including economics, educational psychology, cognitive science and sociology, to name only a few. Accordingly, some of the research questions inherent in the framework relate to different disciplinary perspectives. The primary purpose is to create a common basis for formulating and testing hypotheses as well as to interpret the findings in the empirical studies that follow. In particular, the framework facilitates the process of theorizing and hypothesizing on the relationships and processes concerning lifelong learning as well as their antecedents and consequences. Study II. Determinants of literacy proficiency: A lifelong-lifewide learning perspective This study investigates lifelong and lifewide processes of skill formation. In particular, it seeks to estimate the substitutability and complementarity effects of learning in multiple settings over the lifespan on literacy skill formation. This is done by investigating the predictive capacity of major determinants of literacy proficiency that are associated with a variety of learning contexts including school, home, work, community and leisure. An identical structural model based on previous research is fitted to the IALS data for 18 countries. The results show that even after accounting for all factors, education remains the most important predictor of literacy proficiency. In all countries, however, the total effect of education is significantly mediated through further learning occurring at work, at home and in the community. Therefore, the job and other literacy related factors complement education in predicting literacy proficiency. This result points to a virtual cycle of lifelong learning, particularly to how educational attainment influences other learning behaviours throughout life. In addition, results show that home background as measured by parents’ education is also a strong predictor of literacy proficiency, but in many countries this occurs only if a favourable home background is complemented with some post-secondary education. Study III. The effect of literacy proficiency on earnings: An aggregated occupational approach using the Canadian IALS data This study uses data from the Canadian Adult Literacy Survey to estimate the earnings return to literacy skills. The approach adapts a labour segmented view of the labour market by aggregating occupations into seven types, enabling the estimation of the variable impact of literacy proficiency on earnings, both within and between different types of occupations. This is done using Hierarchical Linear Modeling (HLM). The method used to construct the aggregated occupational classification is based on analysis that considers the role of cognitive and other skills in relation to the nature of occupational tasks. Substantial premiums are found to be associated with some occupational types even after adjusting for within occupational differences in individual characteristics such as schooling, literacy proficiency, labour force experience and gender. Average years of schooling and average levels of literacy proficiency at the between level account for over two-thirds of the premiums. Within occupations, there are significant returns to schooling but they vary depending on the type of occupations. In contrast, the within occupational return of literacy proficiency is not necessarily significant. The latter depends on the type of occupation. Study IV: Determinants of economic and social outcomes from a lifewide learning perspective in Canada In this study the relationship between learning in different contexts, which span the lifewide learning dimension, and individual earnings on the one hand and community participation on the other are examined in separate but comparable models. Data from the Canadian Adult Literacy Survey are used to estimate structural models, which correspond closely to the common conceptual framework outlined in Study I. The findings suggest that the relationship between formal education and economic and social outcomes is complex with confounding effects. The results indicate that learning occurring in different contexts and for different reasons leads to different kinds of benefits. The latter finding suggests a potential trade-off between realizing economic and social benefits through learning that are taken for either job-related or personal-interest related reasons. Study V: The effects of learning on economic and social well being: A comparative analysis Using the same structural model as in Study IV, hypotheses are comparatively examined using the International Adult Literacy Survey data for Canada, Denmark, the Netherlands, Norway, the United Kingdom, and the United States. The main finding from Study IV is confirmed for an additional five countries, namely that the effect of initial schooling on well being is more complex than a direct one and it is significantly mediated by subsequent learning. Additionally, findings suggest that people who devote more time to learning for job-related reasons than learning for personal-interest related reasons experience higher levels of economic well being. Moreover, devoting too much time to learning for personal-interest related reasons has a negative effect on earnings except in Denmark. But the more time people devote to learning for personal-interest related reasons tends to contribute to higher levels of social well being. These results again suggest a trade-off in learning for different reasons and in different contexts.

Quantifying the Economics of Medical Malpractice - A View from a Civil Law Perspective

Life is full of uncertainties. Legal rules should have a clear intention, motivation and purpose in order to diminish daily uncertainties. However, practice shows that their consequences are complex and hard to predict. For instance, tort law has the general objectives of deterring future negligent behavior and compensating the victims of someone else's negligence. Achieving these goals are particularly difficult in medical malpractice cases. To start with, when patients search for medical care they are typically sick in the first place. In case harm materializes during the treatment, it might be very hard to assess if it was due to substandard medical care or to the patient's poor health conditions. Moreover, the practice of medicine has a positive externality on the society, meaning that the design of legal rules is crucial: for instance, it should not result in physicians avoiding practicing their activity just because they are afraid of being sued even when they acted according to the standard level of care. The empirical literature on medical malpractice has been developing substantially in the past two decades, with the American case being the most studied one. Evidence from civil law tradition countries is more difficult to find. The aim of this thesis is to contribute to the empirical literature on medical malpractice, using two civil law countries as a case-study: Spain and Italy. The goal of this thesis is to investigate, in the first place, some of the consequences of having two separate sub-systems (administrative and civil) coexisting within the same legal system, which is common in civil law tradition countries with a public national health system (such as Spain, France and Portugal). When this holds, different procedures might apply depending on the type of hospital where the injury took place (essentially whether it is a public hospital or a private hospital). Therefore, a patient injured in a public hospital should file a claim in administrative courts while a patient suffering an identical medical accident should file a claim in civil courts. A natural question that the reader might pose is why should both administrative and civil courts decide medical malpractice cases? Moreover, can this specialization of courts influence how judges decide medical malpractice cases? In the past few years, there was a general concern with patient safety, which is currently on the agenda of several national governments. Some initiatives have been taken at the international level, with the aim of preventing harm to patients during treatment and care. A negligently injured patient might present a claim against the health care provider with the aim of being compensated for the economic loss and for pain and suffering. In several European countries, health care is mainly provided by a public national health system, which means that if a patient harmed in a public hospital succeeds in a claim against the hospital, public expenditures increase because the State takes part in the litigation process. This poses a problem in a context of increasing national health expenditures and public debt. In Italy, with the aim of increasing patient safety, some regions implemented a monitoring system on medical malpractice claims. However, if properly implemented, this reform shall also allow for a reduction in medical malpractice insurance costs. This thesis is organized as follows. Chapter 1 provides a review of the empirical literature on medical malpractice, where studies on outcomes and merit of claims, costs and defensive medicine are presented. Chapter 2 presents an empirical analysis of medical malpractice claims arriving to the Spanish Supreme Court. The focus is on reversal rates for civil and administrative decisions. Administrative decisions appealed by the plaintiff have the highest reversal rates. The results show a bias in lower administrative courts, which tend to focus on the State side. We provide a detailed explanation for these results, which can rely on the organization of administrative judges career. Chapter 3 assesses predictors of compensation in medical malpractice cases appealed to the Spanish Supreme Court and investigates the amount of damages attributed to patients. The results show horizontal equity between administrative and civil decisions (controlling for observable case characteristics) and vertical inequity (patients suffering more severe injuries tend to receive higher payouts). In order to execute these analyses, a database of medical malpractice decisions appealed to the Administrative and Civil Chambers of the Spanish Supreme Court from 2006 until 2009 (designated by the Spanish Supreme Court Medical Malpractice Dataset (SSCMMD)) has been created. A description of how the SSCMMD was built and of the Spanish legal system is presented as well. Chapter 4 includes an empirical investigation of the effect of a monitoring system for medical malpractice claims on insurance premiums. In Italy, some regions adopted this policy in different years, while others did not. The study uses data on insurance premiums from Italian public hospitals for the years 2001-2008. This is a significant difference as most of the studies use the insurance company as unit of analysis. Although insurance premiums have risen from 2001 to 2008, the increase was lower for regions adopting a monitoring system for medical claims. Possible implications of this system are also provided. Finally, Chapter 5 discusses the main findings, describes possible future research and concludes.

Medical Malpractice in Public Healthcare Systems: An Empirical Investigation of Scheduled Damages

In the last decades, medical malpractice has been framed as one of the most critical issues for healthcare providers and health policy, holding a central role on both the policy agenda and public debate. The Law and Economics literature has devoted much attention to medical malpractice and to the investigation of the impact of malpractice reforms. Nonetheless, some reforms have been much less empirically studied as in the case of schedules, and their effects remain highly debated. The present work seeks to contribute to the study of medical malpractice and of schedules of noneconomic damages in a civil law country with a public national health system, using Italy as case study. Besides considering schedules and exploiting a quasi-experimental setting, the novelty of our contribution consists in the inclusion of the performance of the judiciary (measured as courts’ civil backlog) in the empirical analysis. The empirical analysis is twofold. First, it investigates how limiting compensations for pain and suffering through schedules impacts on the malpractice insurance market in terms of presence of private insurers and of premiums applied. Second, it examines whether, and to what extent, healthcare providers react to the implementation of this policy in terms of both levels and composition of the medical treatments offered. Our findings show that the introduction of schedules increases the presence of insurers only in inefficient courts, while it does not produce significant effects on paid premiums. Judicial inefficiency is attractive to insurers for average values of schedules penetration of the market, with an increasing positive impact of inefficiency as the territorial coverage of schedules increases. Moreover, the implementation of schedules tends to reduce the use of defensive practices on the part of clinicians, but the magnitude of this impact is ultimately determined by the actual degree of backlog of the court implementing schedules.

Impact Assessment: Organic Cotton in Jalalabad, Oblast, Kyrgyztan

The aim of the study was to examine the economic performance as well as perceived social and environmental impacts of organic cotton in Southern Kyrgyzstan on the basis of a comparative field study (44 certified organic farmers and 33 conventional farmers) carried out in 2009. It also investigated farmers’ motivation for and assessment of conversion to organic farming. Cotton yields on organic farms were found to be 10% lower whereby input costs per unit were 42% lower, which resulted in organic farmers having a 20% higher revenue from cotton. Due to lower input costs and organic and fair trade price premiums the average gross margin from organic cotton was 27%. In addition to direct economic benefits organic farmers enjoy a number of additional benefits such as easy access to credits on favourable terms, provision with uncontaminated cotton cooking oil and seed cake as animal feed, marketing support as well as extension and training, services provided by the newly established organic service provider. A big majority of organic farmers perceives an improvement of soil qualities, improved health conditions, and positively assesses their previous decision to convert to organic farming. The major disadvantage of organic farming is the high manual labour input required. In the study area, where manual farm work is mainly women’s work and male labour migration widespread, women are most affected by this negative aspect of organic farming. Altogether, the results suggest that despite the inconvenience of higher work load the advantages of organic farming outweigh the disadvantages and that conversion to organic farming can improve the livelihoods of small-scale farmers.

Potential and limitations of organic and fair trade cotton for improving livelihoods of smallholders: evidence from Central Asia

Cotton is a leading agricultural non-food commodity associated with soil degradation, water pollution and pesticide poisoning due to high levels of agrochemical inputs. Organic farming is often promoted as a means of addressing the economic, environmental and health risks of conventional cotton production, and it is slowly gaining ground in the global cotton market. Organic and fair trade cotton are widely seen as opportunities for smallholder farmers to improve their livelihoods thanks to higher returns, lower input costs and fewer risks. Despite an increasing number of studies comparing the profitability of organic and non-organic farming systems in developing and industrialized countries, little has been published on organic farming in Central Asia. The aim of this article is to describe the economic performance and perceived social and environmental impacts of organic cotton in southern Kyrgyzstan, drawing on a comparative field study conducted by the author in 2009. In addition to economic and environmental aspects, the study investigated farmers’ motivations toward and assessment of conversion to organic farming. Cotton yields on organic farms were found to be 10% lower, while input costs per unit were 42% lower; as a result, organic farmers’ cotton revenues were 20% higher. Due to lower input costs as well as organic and fair trade price premiums, the average gross margin from organic cotton was 27% higher. In addition to direct economic benefits, organic farmers enjoy other benefits, such as easy access to credit on favorable terms, provision of uncontaminated cottonseed cooking oil and cottonseed cake as animal feed, and marketing support as well as extension and training services provided by newly established organic service providers. The majority of organic farmers perceive improved soil quality, improved health conditions, and positively assess their initial decision to convert to organic farming. The major disadvantage of organic farming is the high manual labor input required. In the study area, where manual farm work is mainly women's work and male labor migration is widespread, women are most affected by this negative aspect of organic farming. Altogether, the results suggest that, despite the inconvenience of a higher workload, the advantages of organic farming outweigh its disadvantages and that conversion to organic farming improves the livelihoods of small-scale farmers.

The Recent Structure of Wages in the Czech Republic

The project drew on an extensive firm-level sample of employees to describe in detail the recent evolution of the structure of wages in the Czech Republic between 1995 and 1998. The results of the analysis were then compared with information from EU countries. Regression analysis was used to study a number of specific questions, with particular emphasis being paid to proper weighting of the sample. Jurajda first quantified the effects on male and female hourly wages in the Czech Republic of worker age and education, firm size, region, industry and ownership type. He then examined whether these effects have been changing over time and how they differ by gender, and identified those industrial sectors that carry the largest wage premiums not accounted for by worker or firm characteristics, and measured the effect of unemployment on wages. He found a substantial increase in returns on human capital, with the earning differentials for education increasing substantially between 1995 and 1998, with these gains being largely comparable to those in western countries. Overall, the Czech structure of wages is now very responsive to market forces and is converging rapidly on EU-type flexibility in almost every dimension. It is likely, however, that due to the constrained supply of tertiary-educated workers in particular, the returns on education may keep on rising, surpassing levels typical of western economies and potentially reaching the high levels observed in developing countries.

Potential Economic Returns from Selling Beef in a Specified Value-Based Market

Three groups of steers--one theoretical group and two experimental groups—were evaluated for marketing cattle live, as boxed beef, and grade and yield when the live price was $71 to $73/cwt, grade and yield price $125/cwt for Choice yield grade 3 carcasses with $20/cwt discount for Select carcasses, and in a commodity-trim or close-trim boxed beef market. The results show that the value of highyielding steers can be significantly increased if sold in a close-trim boxed beef market. The close-trim premiums ranged from $5.06 per head for Select close-trim yield grade 4 carcasses to $87.18 per head for close-trim Choice yield grade 1 carcasses. A group of experimental steers averaging 82% Choice and 60% yield grades 1 and 2 returned an additional $104 in the close-trim boxed market compared with selling live for $73/cwt. Another group of experimental steers averaging 21% Choice, 18% Standard, and 93% yield grades 1 and 2 had $29 per head greater return than if the steers had been sold live for $71/cwt. These comparisons emphasize the importance of knowing how cattle will potentially grade before selecting an alternative marketing strategy. This prior knowledge is most important when the spread in price between Choice and Select is high. Producers need to learn more about their cattle to predict how the cattle may grade for a specified value-based market.

Effects of Sorting Steer Calves on Feedlot Performance and Carcass Value

Three groups of steer calves totaling 480 head were sorted into smaller and larger frame sizes, and those groups were sorted into groups with more and less backfat. There was no difference in age among the four sorted groups. The larger steers and steers with less fat had faster rates of gain and tended to have superior feed efficiencies. Steers with more initial fat were fed fewer days. The larger framed steers and steers with less fat had heavier carcasses, less carcass backfat, more yield grade 1 carcasses and a lower percentage of Choice carcasses, but they also had greater value per carcass when evaluated using a grid paying premiums for quality and yield grades. The greatest profit to the feedyard was realized from the smaller framed steers and those with less initial backfat. For similar profit it was calculated that the larger steers should have been discounted as feeders $3.50 per hundred compared with the smaller steers and the steers with more fat discounted $5.00 per hundred compared with those having less initial fat. The results of this study suggest that sorting based on initial fat thickness may have more potential for enhancing the value of finished cattle than sorting based on frame score.