Live cattle are increasingly priced as an explicit function of U.S. Department of Agriculture yield and quality grades. Human graders visually inspect each slaughtered carcass and call grades in a matter of seconds as the carcass passes on a moving trolley. We examine whether there is systematic bias in grade calls using a sample of loads delivered to three different midwestern packing plants during 2000–2002. Overall, results indicate that indeed there is a bias, and that grading standards vary significantly across packing plants. Results also are consistent with a behavioral model where graders are more accurate when grading relatively low-quality carcasses.
This working paper was published as Hueth, Brent, Philippe Marcoul and John Lawrence, "Grader Bias in Cattle Markets? Evidence from Iowa," American Journal of Agricultural Economics 89 (2007): 890–903, doi:10.1111/j.1467-8276.2007.01026.x.
Hueth, Brent M.; Lawrence, John D.; and Marcoul, Philippe, "Grader Bias in Cattle Markets? Evidence from Iowa" (2004). CARD Working Papers. 413.