Title: The Economics and Ecology of the Risk
of Invasive Plant Establishment from the Horticultural Trade in
North America
Principal Investigator: Edward Barbier
Affiliation: University of Wyoming, Laramie, WY
Award: $ 207,000
This project will develop an integrated economic and ecological
analysis of the costs and benefits associated with the risk of invasive
plant establishment, where the source of the accidental introduction
is through commercial horticultural trade in North America. The
analysis will examine the potential tradeoff between the profits
of the commercial plant breeding industry with the expected losses
associated with the risk of accidental introduction. Specific policy
interventions for reducing the risk of accidental introduction by
the industry, including “doing nothing”, self-regulation
by the industry, taxing or banning the sale of exotic species, and
policy coordination between the U.S. and Canadian governments, will
be evaluated.
Title: Strategic Behavior, Incentives, Heterogeneity, and
Invasive Species Management
Principal Investigator: Janie M. Chermak
Affiliation: University of New Mexico, Albuquerque, NM
Award: $200,000
This project will examine ranchers’ incentives for invasive
species prevention and management and evaluate the potential effectiveness
of public prevention and management strategies implemented prior
to a critical level of establishment. The researchers will focus
on Russian knapweed and yellow starthistle in New Mexico. They will
use a dynamic game theoretic approach to structure the study to
estimate the value that ranchers place on increased mitigation of
the species at different levels of infestation, evaluate the economic
conditions that create private incentives that counter public efforts
at invasive species management, and assess the impact of strategic
behavior on welfare.
Title: Policy Instruments for Prevention of Invasive Species
in Strategic International Trade Relationships
Principal Investigator: Lars Olson
Affiliation: University of Maryland, College Park, MD
Award: $157,000
This project will examine the types of import rules and policies
that would induce exporting firms to voluntarily reduce the risks
of exporting exotic species to the United States. The researchers
will analyze the extent to which self-regulation and voluntary compliance
in the foreign exporting industry can be secured, the associated
economic costs, and the economic factors that influence the effectiveness
of permissible trade sanctions in securing cooperation between importing
and exporting countries. The results will improve understanding
of the circumstances under which domestic trade policy would be
required to induce foreign governments to regulate exports. The
researchers will use a game theoretic approach to examine interactions
between private producers in exporting countries and governments
of importing countries and between governments of importing and
exporting countries.
Title: Value of Animal Traceability Systems in Managing
Contagious Animal Diseases
Principal Investigator: Ted Schroeder
Affiliation: Kansas State University, Manhattan, KS
Award: $151,800
This project will evaluate the benefits, costs, and market impact
of animal identification and traceback programs for the U.S. beef
sector in the event of introduction of a foreign animal disease.
A multidisciplinary team of experts will integrate economic and
disease spread models to determine the economic value of different
types of animal identification/traceback systems to manage an outbreak
of foot-and-mouth disease in areas of the High Plains region where
cattle feedlots are located. Results from the disease spread model
will be incorporated into an equilibrium displacement model, along
with prices, quantities, elasticities, and supply and demand shifters,
to estimate changes in producer and consumer welfare associated
with different animal identification options.
Title: Border Enforcement, Importer Behavior, and Trade-Related
Invasive Species Risks
Principal Investigator: David Zilberman
Affiliation: University of California, Berkeley, CA
Award: $136,000
This research will use an agent-based model (ABM) to study importer
and border inspector behavior related to invasive species management.
The major question addressed is how different inspection protocols
affect export firms’ incentives to control or eliminate pests
versus their incentives to avoid inspections or hide problems. A
spatially explicit damage function will be incorporated into the
ABM framework to evaluate and rank different inspection and enforcement
regimes that vary by port or importer.
Title: Seed Trade and Invasive Species Risk: Identifying
Arbitrary SPS Regulations, Their Cost, and Impact on Trade and Welfare
Principal Investigator: John Beghin
Affiliation: Iowa State University, Ames, IA
Award: $132,000
This project will evaluate the benefits of removing phytosanitary
barriers to U.S. exports of planting seeds. A multidisciplinary
team of researchers will identify foreign regulations that do not
meet scientific standards, determine the cost associated with the
tests, and estimate the economic impact of liberalizing seed trade
by removing these barriers to U.S. seed exports.
Title: Insect Derivatives: Managing Insect Risk with Financial
Instruments
Principal Investigator: Timothy Richards
Affiliation: Arizona State University, Mesa, AZ
Award: $104,000
This study will examine options for the design of financial instruments
known as insect derivatives, a market-based approach for growers
to mitigate the economic risk of insect damage. The research will
develop a pricing model for the derivative contract that represents
a contingent claim on the population of a specific insect for use
by traders (growers and pest-control firms) to manage income risk.
A case study will evaluate the use of insect derivatives to help
cotton growers achieve a dynamically optimal, expected utility maximizing
program of managing pest damage by combining agronomic and financial
risk management methods.
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