Gene Flow, Discounting and Investment Appraisal

1. Evaluating the economic costs-benefits of a particular selection or breeding decision. By following the flow of genes through a population as a result of a particular breeding decision, it is possible to estimate the net economic cost-benefits of that breeding decision. For example, when looking at the value of the use of a particular bull in a dairy herd, we can note that each replacement heifer that results from use of that bull, carrying 1⁄2 of the bull's genes, will give, on average, n lactations and will produce, on average, one replacement daughter (carrying 1⁄4 of the bulls genes), also with an expected n lactations, and so on. By taking into account the probability that a single dose of semen results in a replacement heifer, it is then possible to determine the net economic value of that semen in terms of the value of the total number of lactations of his descendants in the herd over a defined time horizon, and compare those expected returns against the cost of the semen.