Estimates of rates of return on investments in cattle among the Tawahka and Miskitu Amerindians of the Patuca river in Honduras are presented. Internal rates of return and net present values produced similar rankings. The median internal rate of return is 9% and the median net present value is 224 Lempiras (U.S.$33). Positive rates of return suggest cattle is a viable way of saving and smoothing consumption across time. The use of animals as savings may increase neotropical deforestation by indigenous populations until financial institutions step in to provide alternative and secure approaches to savings.
Key words savings - cattle - Tawahka - Miskitu - Honduras - consumption smoothing