SYMPOSIUM: THE DAIRY COW OF THE F U T U R E - BIOLOGICAL REQUIREMENTS FOR ECONOMIC EFFICIENCY Prospectives for Genetic Improvement in the Economic Efficiency of Dairy Cattle t

Decision methods affecting genetic composition of a herd become more practical as the objective function summarizes outputs at higher levels of organization. Incorporation of util i ty concepts beyond those strictly economic would lead also to practical decision methods by satisfying a spectrum of value considerations. Utility should include economic value and risk philosophy. Measurements of the net effect of performance derived from cows bred and producing in a herd over time lead to complex decision methods. A selection index or a best linear unbiased prediction technique by itself does not accommodate resource constraints, for example. Results from the literature are used to illustrate applications of animal indexing and mathematical programming that reflect differences in improvement programs differing in level of organization and concept of utility. Further developments of decision methods to improve economic efficiency will depend on important cost factors not now in applied objective functions. Effects of costs, per cow fixed costs, and cost of feed energy are important for Received July 23, 1984. Contribution to NC-119, Improving Dairy Herd Management Practices and to NC-2, Improving Dairy Cattle, with Special Emphasis On Selection. Salaries and research support provided by State and Federal funds appropriated to the Ohio Agricultural Research and Development Center, The Ohio State University. Journal Article No. 95-84. Dairy Science Department. Reprint requests and correspondence. 3Agricultural Economic Department, 103 Agricultural Administration, 2120 Fyffe Road, Columbus, OH 43210. evaluating genotypes for economic efficiency. Higher production per cow contributes to decrease of cost of production by spreading costs of a cow space per year over more units of output . When body size limits further declines of cost from production, increasing body size may provide capacity necessary to utilize more forages at lower cost per nutrient unit. Relative differences in average cost of feed energy should be included in sire indexes.