HOW ACCURATE ARE FARMERS IN ASSESSING THE GAINS ASSOCIATED WITH QUALITY? THE CASE OF THE MEAT GOAT INDUSTRY

Abstract

Meat goat producers were queried to determine subjective estimates of premiums they would receive for slaughter kids of various selection classes. Market-based predicted premium estimates were obtained via regression using published U.S. Department of Agriculture Agricultural Marketing Service data. Subjective versus market-based predicted premium estimates were compared to determine producer accuracy in predicting premiums. Producers tended to overestimate quality premiums. Producers more accurate in their estimates tended to be larger-scale and older and to hold college degrees, sell more slaughter goats via auction, and manage their goats more intensively. Results contribute to the literature on producer accuracy in predicting prices.