Agriculture Reference
In-Depth Information
E CONOMICS OF R ESISTANCE M ANAGEMENT
When a pest population is confined to an individual farming operation,
many of the benefits and costs associated with the farmer's pest control
decisions accrue to and are borne by the farmer. In this hypothetical
scenario, economic theory suggests that the pest population will be
maintained at an economically efficient or socially optimal level. 1
However, when the pest moves from farm to farm, the pest control
decisions made by any given farmer will affect the net returns accruing to
that farmer, as well as those accruing to nearby farmers, although to a
lesser extent. Because the effects of any farmer's control decisions on the
regional pest population are practically negligible and because the benefits
and costs associated with those effects are not borne by any given farmer
(are not fully internalized), those effects might not be accounted for in the
farmer's control decision. Because regional pest population dynamics are
determined collectively by the decisions made by each farmer in the
region, however, economic theory suggests that the pest population will not
be maintained at a socially optimal level (Feder and Regev 1975).
This situation is referred to in the economics literature as a stock
externality, an economic environment in which an individual ignores the
impact of a decision that affects the level of a resource that is used by
others (Gordon, 1954). In the presence of a stock externality, the resource
might not be managed in a socially optimal manner. When the resource is a
mobile pest population, Feder and Regev (1975) show how the introduction
of a marginal user cost on pesticides, via a tax or a subsidy depending on
the characteristics of the problem, can improve social welfare by ensuring
that all of the net returns to pesticide use accrue to each user. The marginal
user cost for a pesticide is the marginal expected present value of economic
and environmental costs associated with the use of the pesticide, including
impacts on regional pest population dynamics, impacts on the regional
population dynamics of beneficial organisms that prey on the pest, and the
evolution of resistance in the regional pest population to the pesticide, as
well as the health effects associated with the accumulation of toxic
pesticide residues and water/air pollution.
Pesticide resistance evolution is a process of artificial selection in
which pesticide use favors the survival of particular insects and weeds and
other pests resistant to the pesticide so that the frequency of resistant
individuals in the population increases over time.
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