INFLUENCE OF HERD-LIFE OPPORTUNITY AND CHARACTERISTICS OF COWS AND HERDS ON DIFFERENT NET INCOME FUNCTIONS

A sample of one-third of all Holstein records available for national sire evaluations in January 1989 formed the data. Cows were included with opportunity for calving through 48, 60, and 72 mo of age. Net income functions examined were relative net income, discounted relative net income, and relative net income adjusted for opportunity cost of a postponed replacement. Means and standard deviations of net income functions increased with longer herd-life opportunity but less for the function adjusted for opportunity cost. Correlations between different herd-life opportunities within net income function were from .80 to .95 and were highest (>.94) between 60- and 72-mo herd-life opportunities. Correlations across net income function for the same herd-life opportunity were >.95. Relative net income adjusted for opportunity cost was less correlated with days of productive life than with the other two net income functions and was less accurately predicted by length of productive life, first lactation milk production, and age at first freshening. Within-herd management practices, except first lactation production, were nearly unrelated to relative net income adjusted for opportunity cost. For mixed herds, registered cows had higher net incomes by $9 to $28 each, depending on herd-life opportunity. Adjustment for opportunity cost could affect conclusions of studies based on net income functions.