In a recent article, Peter C. Carstensen, AAI Senior Fellow and Professor of Law Emeritus University of Wisconsin Law School, provides a critique of economic research on marketing of beef cattle. The article, “Dr. Pangloss as an Agricultural Economist,” responds to analysis included in The U.S. Beef Supply Chain: Issues and Challenges (Proceedings of Workshop of Cattle Markets, Kansas City, Missouri, June 3-4, 2021).
In August of 2020, the then leadership of the House Agriculture Committee requested USDA to fund research on issues surrounding the marketing of beef cattle, including industry structure, barriers to entry, price discovery and methods to address deficiencies, and purchasing mandates.
Texas A&M University and its Agricultural and Food Policy Center carried out the project, which produced nine articles that present a “sustained, unreflective, Panglossian, defense of the status quo.”
Professor Carstensen’s analysis reveals the central concern that, with minor exceptions, the articles in the proceedings fail to address the relationship between the market power of the packers and the choice of buying methods which might exploit that power by choosing the most anticompetitive method to accomplish efficiency enhancing goals.