Towards sustainable beef: The role of altruistic preference in the value chain transformation

Abstract

Transformative changes in the beef value chain are crucial for achieving various United Nations Sustainable Development Goals but face major challenges. Altruistic preferences exhibited by beef packers and retailers might play a positive role in transforming the beef value chain to improve its sustainability. Our paper examines whether altruistic preference can alter traditional market dynamics, resulting in improved environmental and economic outcomes within the beef industry. We employ a game-theoretical framework to investigate the strategic behaviors of the beef value chain participants. We apply the game theory model to the United States beef value chain. Our results show that altruistic preference from the beef packer and retailer alliance can improve the value chain’s efficiency and sustainability. As the alliance’s level of altruism rises, ranchers become more motivated to ramp up their emissions reduction efforts, resulting in higher profits for them. Reducing emissions reduction cost and increasing the price of carbon credits also provide positive incentives for ranchers to adopt sustainable technologies and farming practices to improve the sustainability of the value chain. These findings hold significant implications for beef value chain stakeholders on how altruistic preference from participants can be leveraged to improve value chain sustainability and efficiency.