Continued Existence of Cows Disproves Central Tenets of Capitalism?

Dean Karlan, Santosh Anagol and Alvin Etang

No 9639, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We examine the returns from owning cows and buffaloes in rural India. We estimate that when valuing labor at market wages, households earn large, negative average returns from holding cows and buffaloes, at negative 64% and negative 39% respectively. This puzzle is mostly explained if we value the household?s own labor at zero (a stark assumption), in which case estimated average returns for cows is negative 6% and positive 13% for buffaloes. Why do households continue to invest in livestock if economic returns are negative, or are these estimates wrong? We discuss potential explanations, including labor market failures, for why livestock investments may persist.

Keywords: investment; Labor markets; Livestock; Profits; Savings (search for similar items in EconPapers)
JEL-codes: E21 M4 O12 Q1 (search for similar items in EconPapers)
Date: 2013-09
New Economics Papers: this item is included in nep-mac and nep-pke
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Citations: View citations in EconPapers (11)

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Related works:
Journal Article: Continued Existence of Cows Disproves Central Tenets of Capitalism? (2017)
Working Paper: Continued Existence of Cows Disproves Central Tenets of Capitalism? (2014)
Working Paper: Continued Existence of Cows Disproves Central Tenets of Capitalism? (2014)
Working Paper: Continued Existence ofr Cows Disproves Central Tenets of Capitalism? (2013)
Working Paper: Continued Existence of Cows Disproves Central Tenets of Capitalism? (2013)
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