- The reduction in goat milk production and the competitiveness of more profitable activities have increased the adoption of measures to enhance goat milk and meat around the world. A simulation model was built to evaluate the dynamics of a dairy goat herd under different scenarios of production. A System Dynamics approach was used to identify management policies that could affect the behaviour of the herd over 10 years of simulation using data from a dairy goat herd in Brazil. The impact of reproductive and mortality rates, one or two annual reproductive cycles on production, and economic health of dairy goats on changes in the herd dynamics were evaluated. Simulations indicated that small changes in reproduction and mortality rates and milk price can considerably affect the dynamics of the herd as well as the financial health of the production system. The interferences created to visualize the effects were not immediately realized because of intrinsic delays in the system. The comparison of models with one or two breeding seasons indicated that the latter was considerably more profitable and had a faster turnover. It was also found that the two breeding season had a greater capacity to support reduction in milk price that could generate financial instability in the production system. It was concluded that mathematical models can be used to predict impacts in management policies on herd dynamics and sensitivity to support the dairy goat activity showing its viability as an agricultural activity that can contribute to the production and incomes in small farms. 2009 Elsevier Ltd. All rights reserved.