Economies of Size, Tax Reform and Profitability of Alternative Midwestern Feedlot Systems

Mark R. Weimar, Arne Hallam () and Larry D. Trede

ISU General Staff Papers from Iowa State University, Department of Economics

Abstract: The Tax Reform Act of 1986 may have substantial impacts on cattle feeding operations in the Midwest. Changes in the tax laws may encourage different investment patterns in feedlots as to size, type of facility, feeding programs, and age of animal fed. Cost and returns are computed for a variety of feeding systems under the new and old tax laws.Substantial economies of size were found under both tax laws, bu they were more extreme under the new tax system.

Date: 1988-01-01
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