How transaction costs influence cattle marketing decisions in the Northern Communal Areas of Namibia

Abstract

In this article a non-linear dynamic model is applied to determine the influence of transaction costs on the marketing decisions of cattle owners in the Northern Communal Areas of Namibia. The article tests the hypothesis that a producer's choice between alternative marketing options is influenced by transaction costs. The study shows that a number of transaction cost variables (herd size, distance from auction points, information and risk) have a significant effect on the proportion sold to Meatco and thus indirectly on the choice of marketing channels.