Increased levels of inbreeding can create "inbreeding depression" which can lead to decreased performance including lower weight gain, decreased fertility, and overall decreased fitness. Data suggest that inbreeding levels of 10% can lead to a 4% increase in open animals and a 1% increase in the number of animals born dead, while an inbreeding level of 50% can increase the percentage of open cows by 17% and the number of dead calves by 5%. Inbreeding also increases the risk of undesirable alleles pairing together as in the case of lethal genetic defects. If two animals come from a common ancestor that carries a recessive allele that causes a defect, then mating the two results in a chance (not certainty) that the defect could manifest itself because the recessive alleles could pair together.
A good publication that describes how to calculate inbreeding and the effects of inbreeding depression is Oklahoma State University publication ASCI-3165, Inbreeding in Cattle. There is a plethora of papers on the effects of inbreeding in cattle in the Journal of Animal Science (e.g., McParland et al., 2008).
In the example that you describe (half-sib mating), the inbreeding level in the corresponding offspring would be 12.5%, assuming that the only animal in common in their pedigrees is their sire. Some seedstock producers use mild inbreeding (linebreeding) to increase the influence of a superior animal. In commercial settings, inbreeding should be avoided.
