The Price of Fame: The Effect of Award-Winning Pedigrees on the Price of Livestock Genetics

Abstract

We estimate the impact of winning an award at a cattle show on the price of cattle genetics and that of their relatives. Dairy farmers choose from various dairy bulls for breeding. These bulls possess genetic traits that reflect their productivity, resiliency to disease, and physical characteristics. Another relevant attribute of dairy bulls is their pedigree prestige, which dairy farmers can use as a proxy for quality. We test the importance of pedigree prestige in determining dairy bull prices by examining the winners and runners-up of “Premier Sire” at the annual World Dairy Expo. Using an event study framework, we find that bulls that win Premiere Sire experience a 10 percent in their price compared to the second-place winner. This impact is also transmitted to their relatives, meaning the effects of prestige spillover into their genetic network.