Mandatory Livestock Traceability as a Catalyst for Knowledge Intensive Services in Uruguay

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Jun 2015
In 2006 Uruguay's Parliament voted to establish a system of individual livestock traceability that would initially be mandatory for bovine populations, and in future stages will encompass all domestic animals for sale and consumption. Besides attaching electronic eartags to each individual carrying unique identifier information, the system has the capacity to generate individual level databases and customized reports, with the government's compliance controls acting as completeness guarantees. The amount and other characteristics of the data being accumulated would suggest that there would be space for innovators to come up with alternative uses of those inputs to generate new lines of business or strengthen the competitive advantage of the livestock industry. This exploratory paper describes key features of two firms and a multi-member consortium that are taking advantage of the traceability system to produce valuable services to the industry and are considering ideas for future developments that would deepen the synergies. Prior to that, but implicit in the whole discussion, is the issue about the nature of the traceability system as a good. While the adoption of a strong public good rhetoric and logic was key to the successful implementation of traceability nationally, the proliferation of profitable spinoffs may bring up the issue of financing the system and dealing differently with public good and for profit services based on it.