The Bolivian beef cattle industry: effects of transportation projects upon plant location and product flows in Beni

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1981
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Ampuero-Ramos, Luis
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Economics

The Department of Economic Science was founded in 1898 to teach economic theory as a truth of industrial life, and was very much concerned with applying economics to business and industry, particularly agriculture. Between 1910 and 1967 it showed the growing influence of other social studies, such as sociology, history, and political science. Today it encompasses the majors of Agricultural Business (preparing for agricultural finance and management), Business Economics, and Economics (for advanced studies in business or economics or for careers in financing, management, insurance, etc).

History
The Department of Economic Science was founded in 1898 under the Division of Industrial Science (later College of Liberal Arts and Sciences); it became co-directed by the Division of Agriculture in 1919. In 1910 it became the Department of Economics and Political Science. In 1913 it became the Department of Applied Economics and Social Science; in 1924 it became the Department of Economics, History, and Sociology; in 1931 it became the Department of Economics and Sociology. In 1967 it became the Department of Economics, and in 2007 it became co-directed by the Colleges of Agriculture and Life Sciences, Liberal Arts and Sciences, and Business.

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1898–present

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  • Department of Economic Science (1898–1910)
  • Department of Economics and Political Science (1910-1913)
  • Department of Applied Economics and Social Science (1913–1924)
  • Department of Economics, History and Sociology (1924–1931)
  • Department of Economics and Sociology (1931–1967)

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Economics
Abstract

Bolivia has the potential to become an important beef exporting country in South America. However, to penetrate foreign markets (in Chile, Peru, and Brazil) she must upgrade her processing facilities. This calls for the construction of new slaughterhouses.;In the course of the 1980s, several new transport linkages (involving roads, railways, and waterways) are to be completed as Bolivians seek to integrate their territory. Most of these new linkages will connect the department of Beni, in the tropical lowland, with the rest of the country. It is in Beni where the greatest potential for cattle-beef production exists.;This study seeks to examine what will happen with the optimal location patterns of new slaughterhouses in Beni and factor-product flows as the new transportation connections are completed. The criterion of optimality selected in the analysis is the minimum combined costs of assembling and slaughtering cattle and distributing beef. Two beef qualities, four plant sizes, four levels of operation, and four export scenarios are considered. The analysis employs an iterative linear programming procedure.;It is found that the new transport projects have a negligible impact upon optimal patterns of plant locations, sizes and levels of operation and factor-product flows. This is so because: (a) For most routes, the new road and rail connections do not reduce transport costs of beef. As a consequence, air transportation continues to be the dominant mode for beef shipments; (b) there exist various institutional constraints, not considered in the mathematical model, which increase beef transport costs in relation to those of live cattle; and (c) given a slaughterhouse size and level of operation, all plant sites have identical processing costs.;The analysis indicates that alternative export scenarios have significant effects upon optimal locations, numbers, and sizes of slaughterhouses. This implies that plant location patterns should be formulated after foreign market opportunities have been carefully assessed.;Various factors were not considered in the analysis, such as other livestock types, taxes and levies, cattle by-products, and seasonal variations in the transportation infrastructure. The study permits one to focus on various areas in which existing information is weak. Several possible extensions of the analysis are suggested.

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Thu Jan 01 00:00:00 UTC 1981