Economics Research Institute Study Paper
Utah State University Department of Economics
Copyright for this work is held by the author. Transmission or reproduction of materials protected by copyright beyond that allowed by fair use requires the written permission of the copyright owners. Works not in the public domain cannot be commercially exploited without permission of the copyright owner. Responsibility for any use rests exclusively with the user. For more information contact the Institutional Repository Librarian at email@example.com.
This paper builds a dynamic forward-looking model describing the approximate ten-year cattle cycle. The theoretical model improves on existing models by (1) allowing cow-calf operators to make investment decisions on both the cow and calf margins, (2) formally recognizing the age distribution of the capital stock, and (3) considering a mixed scheme of rational and naive expectations. The model.is then calibrated and used to simulate artificial data that endogenously generates ten-year cycles in the total stock of cattle.
Aadland, David, "Cattle Cycles, Expectations, and the Age Distribution of Capital" (2002). Economic Research Institute Study Papers. Paper 235.