When is a “wait and see” approach to invasive species justified?

Predictions of damages and damages that might be avoided from invasive species control policies are marred by uncertainty that has both economic and ecological roots. Public policies directed at invasive species typically lag their detection. One possible explanation is the coupling of uncertainty with political and economic commitments creates an incentive to delay a policy response in order to gain more information on how damaging the invasion will be – a “wait and see” approach. We investigate whether this rationale is justified by identifying invasion characteristics that require the wait and see approach often adopted by lawmakers and government agencies. The model shows that the source of uncertainty and degree of policy irreversibility matter and allows the classification of invasive species with a low rate of spread and low levels of uncertainty as those where policies can be optimally timed in the future.     

Bioeconomic modeling for control of weeds in natural environments

When a weed invasion is first discovered a decision has to be made on whether to attempt to eradicate it, contain it or do nothing. Ideally, these decisions should be based on a complete benefit-cost analysis, but this is often not possible. A partial analysis, combining knowledge of the rate of spread, seedbank longevity, costs of control and techniques of economic analysis, can assist in making a good decision. This paper presents a decision model to determine when immediate eradication of a weed should be attempted, or more generally whether weed control should be attempted at all. The technique is based on identifying two ‘switching points’: the invasion size at which it is no longer optimal to attempt eradication but where containment may be an option; and the invasion size at which it becomes optimal to apply no form of control at all. The model is applied to a woody perennial weed in a natural environment. The results show that seedbank longevity is the main constraint on the maximum eradicable area and spread rate is the main constraint on the maximum containment area. Stochastic simulations are undertaken to derive probability distributions of costs which are than used to evaluate the effect of budget constraints on areas that can be eradicated. We find that, in the absence of a budget constraint, it may be desirable to eradicate invasions from areas as large as 8000 ha, but when budget constraints typical of those faced by agencies in Australia are introduced, feasible eradicable areas are less than 1000 ha.     

A proactive approach for assessing alternative management programs for an invasive alien pollinator species

Most evaluations of the economic impacts of invasive species are done post facto and concentrate on direct production loss caused. However, the effects of invasive species on non-market services such as biodiversity and landscapes can be considerable. A proactive approach of assessing the expected economic impact of invasive species prior to their occurrence may contribute to greater efficiency of policy makers. Here we used a stated preference method for a priori evaluating the willingness of the population to pay for different control programs of a new invasive bee species in Israel, the dwarf honey bee, Apis florea. We evaluated possible economic impacts of A. florea using two model plant species expected to be adversely affected by its invasion due to decreased pollination. The plants have no market value but they add aesthetic value to the open landscape. Using a mixed logit model we found that the mean willingness to pay (WTP) differed between the model plants, and increased with the extent of plant loss. Respondents differentiated between levels of damage to the plants and between control methods in their preferences for a specific program. Our results provide means for informed proactive decision making in preventing the continued invasion of the bee.     

Policies for the management of weeds in natural ecosystems: the case of scotch broom (Cytisus scoparius,L.) in an Australian national park

Environmental weeds are plants that invade natural ecosystems and present a serious threat to conservation of nature. Environmental weeds have been implicated in the extinction of several indigenous plant species, and they also threaten ecosystem stability and functional complexity. Historically, emphasis in weed control in Australian national parks has been placed on chemicals, manual pulling of small plants, excluding tourists and feral animal control measures. Recently, biological control has been introduced to control weed infestations. These methods typically have been applied as funds have become available, with little opportunity to consider their long-term effectiveness. As the threat from environmental weeds is becoming more fully recognised, an integrated, strategic, ecological and economic approach to weed management is needed. A deterministic dynamic programming model is developed for this purpose in this paper. A case study for scotch broom is presented, to assess the ways in which this approach can address the policy issues that face the community in the management of an environmental weed in a national park. The model takes account of the weed population dynamics, the effectiveness and cost of control measures, and the value of the park outputs (biodiversity, recreation and grazing). The dynamic programming model includes weed density and seed bank as state variables and a budget constraint for the control variables. The model is used to derive optimal control rules for any given state of the weed population. An optimal decision rule provides a package of control measures that can be used to attack the problem each year, depending on the current weed density and seed bank. Optimal trajectories are developed for a planning horizon of 45 years, and the effect of the budget constraint is analysed. The marginal value of an extra dollar for weed control, in terms of discounted future benefits, is estimated. It is shown that a combination of controls that targets both weed density and the seed bank is important. It is also shown (given the assumed parameters) that biological control is worth undertaking, as it appears as part of most of the optimal strategies identified. The paper concludes with policy recommendations for managing weeds in natural ecosystems.     

An integrated decision-support approach in prioritizing risks of non-indigenous species in the face of high uncertainty

When evaluating the risks of future invasions, we often have sparse information on the likelihood that a species will arrive, establish and spread in a new environment, and on the potential impacts should this occur. Conventional risk assessment, therefore, is limited in providing guidance in managing the risk of non-indigenous species (NIS). However, risk management decisions must be made facing these uncertainties to avoid high and irreversible impacts.We develop an integrated ecological economic modeling and deliberative multi-criteria evaluation (DMCE) approach to support group decision-making in risk prioritization, using an example of ten NIS that could potentially impact Australian plant industries. This innovative approach seeks to combine the advantages of dynamic modeling with the benefits of DMCE in assessing and communicating uncertainty. The model unveils the complexity of the socio-ecological system of biological invasion, with a scenario analysis designed to interactively communicate scientific uncertainty to decision-makers. The DMCE provides a structured approach to identifying stakeholders' key concerns in addressing economic, social, and environmental dimensions of NIS risk explicitly. Functioning as a platform for risk communication, the DMCE also offers an opportunity for diverse views to enter the decision-making process and for the negotiation of consensus consensuses.     

An optimization framework for addressing aquatic invasive species

This study develops a bio-economic model framework to optimize the management of aquatic invasive species. Stochastic dynamic programming is applied to investigate when and to what extent a society should engage in efforts to reduce the likelihood of an invasion, to control and eradicate a newly established population, and to adapt to damages. The framework is parameterized for a potential Asian clam (Corbicula fluminea) invasion in the warm water discharge area of a nuclear power plant planned on the northern shores of the Baltic Sea. The sensitivity analysis reveals three distinct strategies: an adaptive strategy, which reduces the damage that an existing invasive species population causes to the private sector; a preventive strategy, which delays the invasion and the resulting damage; and a mitigative strategy, which puts effort into timely detection, control and eradication of the newly established population. Choice of the optimal strategy is sensitive to the unit costs and effectiveness of the measures required, to the level of externalities and to the size of the clam population after the invasion has been detected. The results emphasize the need for the energy sector to identify and internalize the external costs of potential invasions when making any large-scale investment plans.     

The Control of Invasive Species on Private Property with Neighbor-to-Neighbor Spillovers

Invasive pests cross property boundaries. Property managers may have private incentives to control invasive species despite not having sufficient incentive to fully internalize the external costs of their role in spreading the invasion. Each property manager has a right to future use of his own property, but his property may abut others’ properties enabling spread of an invasive species. The incentives for a foresighted property manager to control invasive species have received little attention. We consider the efforts of a foresighted property manager who has rights to future use of a property and has the ability to engage in repeated, discrete control activities. We find that higher rates of dispersal, associated with proximity to neighboring properties, reduce the private incentives for control. Controlling species at one location provides incentives to control at a neighboring location. Control at neighboring locations are strategic complements and coupled with spatial heterogeneity lead to a weaker-link public good problem, in which each property owner is unable to fully appropriate the benefits of his own control activity. Future-use rights and private costs suggest that there is scope for a series of Coase-like exchanges to internalize much of the costs associated with species invasion. Pigouvian taxes on invasive species potentially have qualitatively perverse behavioral effects. A tax with a strong income effect (e.g., failure of effective revenue recycling) can reduce the value of property assets and diminish the incentive to manage insects on one’s own property.     

Using an integrated fuzzy set and deliberative multi-criteria evaluation approach to facilitate decision-making in invasive species management

There are two issues at the core of invasive species risk management: on the one hand, decision-makers struggle to balance environmental goals against other often competing societal goals such as economic benefits and social welfare; on the other hand, uncertainty often prevails in understanding the invasion process and in communicating invasion risks to the stakeholders. In this paper, we describe how an integrated Deliberative Multi-Criteria Evaluation (DMCE) and fuzzy set approach can tackle these two issues in the analysis of alternative risk management strategies, using the example of European House Borer (EHB, Hylotrupes bajulus Linnaeus). DMCE offers a platform for stakeholders to interact and to make a trade-off decision between multiple goals based on social learning and deliberation. The fuzzy set approach, applied within a DMCE framework, explicitly incorporates the inherent uncertainty in estimating potential EHB impacts and in evaluating participants' subjective preferences. This integrated method, therefore, provides a promising approach for tackling the dual challenges of competing goals and uncertainty in the evaluation of invasive species risk management options.     

Public economics of hitchhiking species and tourism-based risk to ecosystem services

This paper is the first to examine the public economics of export-based externalities arising within the provisioning of ecosystem services, with direct application to policies to prevent the spread of hitchhiking invasive species. We find when risk enters through exports, policy makers face a tradeoff between welfare improvements and reducing risk of invasion. Estimates of visitor demand elasticity for ecotourism are low, so price policies are not likely to reduce risk, though they can raise tax revenue. If demand is elastic enough to reduce risk, trade effects can cause loss of income greater than the risk of the invasion. The paper is motivated by the expansion of invasive species’ within the United States. We apply our model to the specific example of quagga and zebra mussels invasion into the U.S. Pacific Northwest.     

An options based bioeconomic model for biological and chemical control of invasive species

The management of non-native invasive species is a complex but crucial task given the potential for economic and environmental damages. For many invasions the development of socially optimal control strategies requires more than is offered by the single-species, single-control models that have dominated this area of research. We develop a general stochastic optimal control framework that accommodates multiple interacting species while accounting for uncertainty in the temporal population dynamics. This extension to the current line of bioeconomic control models allows for the design of optimal integrated pest management strategies that utilize both chemical and biological controls in an environment of uncertainty and irreversibility. We demonstrate the benefits of combining chemical and biological controls in long term management strategies through a case study of the hemlock wooly adelgid (Adelges tsugae) infestation in the eastern United States. In this application we find that the introduction of natural predators is usually sufficient to manage the infestation, though chemical insecticides can play an important role when detection of the infestation is delayed or when the biological control agent does not sufficiently increase mortality of the invasive species.     

Economic Valuation of the Threat Posed by the Establishment of the Asian Tiger Mosquito in Australia

Invasive species policy could be better informed if we understood how much people value reductions in the risks posed by these organisms. This study investigates the public’s willingness to pay (WTP) for additional measures to reduce the risk of invasion of the Australian mainland by the Asian tiger mosquito (ATM). The study contributes to the literature by applying a stated preference method to estimate the public’s WTP to reduce the risk of an ATM invasion, expressed as a change in probability. It is the first ex ante invasive species analysis to test over two discrete invasion reduction probabilities based on management effort. Further, to overcome the challenges in valuing changes in probabilities, the study presented respondents with a well-defined discrete difference in the final probability, with one scenario reducing risk from 50 to 25% and the other from 50 to 5%. We find a significant difference in the mean WTP values between these two scenarios (A$67 vs. A$90). The overall conclusion is that estimated benefits of reducing the probability of an ATM incursion outweigh the costs.     

Modeling the human-induced spread of an aquatic invasive: The case of the zebra mussel

Ecological evidence indicates that transient recreational boating is the principal overland vector of dispersal for several freshwater invasive species. Understanding boating behavior, and how behavior responds to policy changes, is central to understanding the effectiveness of efforts to halt or slow the spread of aquatic invasives. We develop a framework that combines a recreation demand model of boating behavior with a discrete duration model describing the spatial and temporal spread of an aquatic invasive. The integrated approach allows us to link invasion risk probabilities directly to boating behavior, policy levers, and behavior changes arising from policy shocks. With an application to zebra mussels in Wisconsin we show that explicitly accounting for behavioral responses can dramatically change predictions for the effectiveness of particular policies, in some instances leading to increases in invasions risks at some sites.     

Importing exotic plants and the risk of invasion: are market-based instruments adequate?

Exotic plant species are often intentionally imported into regions outside of their normal range as ornamental plants or as breeding stock, thereby generating benefits for consumers and producers. However, one of the unintended side effects of such introductions is that the exotic plant species may become invasive. Prohibiting sale of this type of exotic plant species, on the basis that it may become invasive, will have social costs in the form of foregone consumer benefits and nursery profits. We develop a model of a private commercial plant breeding industry that imports an exotic plant species into a region. The risk associated with invasion is modeled using a probabilistic ‘hazard function’, the key determinants of which are the characteristics of the exotic plant and the number of commercial nurseries contributing to its dispersal. We consider the possibility of employing market-based instruments (e.g., Pigovian tax) consistent with the concept of ‘introducers pay’, to regulate the nursery industry. We then provide an empirical illustration using the historical introduction of saltcedar (Tamarisk spp.) into the United States. Our results indicate that the mere presence of a risk of invasion does not mean that it is socially optimal to prevent commercial sales of an exotic plant species. Indeed, there appear to be plausible forms of the functional relationships involved that require only a modest reduction in the private industry optimum. In contrast, no sales of the exotic plant should occur at all under several sets of assumptions about the level of invasion risk and the linkage between dispersal sites and invasion hazard.     

Control and the management of a spreading invader

We consider the problem of management of an aquatic invader spreading in a lake system. We assume that each year the invader can be removed from a certain proportion of invaded lakes, which depends on the selected intensity of control. Control decisions are generated and compared for an optimally controlled system and for a static optimization across asymptotic steady states. Control close to eradication of the invasive species is always optimal for invasions with relatively high damages, low rates of density dependent spread and/or low chance of additional random introductions. Control to a highly invaded steady state is optimal for those invasions with low relative damages, high chances of random introduction and high levels of uncertainty in species location. In all other cases the optimal outcome depends upon initial conditions. Comparing the relative performance of the optimally controlled system and the static optimization demonstrates situations when the differences are small and when not. When invasions are acted upon in their later stages and across certain parameter combinations a static optimization provides a reasonable approximation of an optimally controlled system. The flip-side is that optimal policies directed at an invasion in its early stages tend to provide significantly savings. The savings vary across parameter combinations, yet in these situations little useful insight will be generated without consideration of a dynamically optimized system.     

Take a risk: Preferring prevention over control of biological invaders

Scientists have argued that invasive species can be managed most cost effectively with greater investments in prevention. Further, under ideas like the precautionary principle it is reasonable to expect that a cautious manager would use more prevention relative to control because it keeps more invaders out. Yet, this is not typically done. In many cases, private and public resources are invested primarily to control existing invaders rather than to prevent new invasions. Managers frequently wait until after invaders have arrived and then scramble to limit the damages. We believe these paradoxical decisions can be understood by recognizing the link between typical human preferences for risk bearing and the technology of risk reduction. We demonstrate quantitatively how managers perceived to be cautious or averse to risk tend to shy away from prevention relative to control. This counterintuitive result arises because control is a safer choice than prevention because its productivity is relatively less risky: it works to remove existing invaders from the system. In contrast, the productivity of prevention is more uncertain because prevention only reduces the chance of invasion, it does not eliminate it, and invasion may not occur even in the absence of prevention. Managers' averse to risk will inherently avoid as much uncertainty as possible, whether the source of uncertainty regards ecological outcomes or economic productivity. Implications for environmental decision making are clear. In invasive species management, if managers act as though they are risk averse, their caution can backfire when it leads to more control rather than prevention. The social consequences of this choice are a greater probability of future invasions and lower social welfare. Our results suggest that social welfare is highest when managers were willing to “take a risk” with prevention.     

Interest rate,size and book-to-market effects in Australian financial firms

The Fama–French three-factor model (1993) has been extensively used to study the pricing of nonfinancial stocks. This study provides the first examination of the pricing of Australian financial stocks using the Fama–French framework. The four-factor model (market, size, book-to-market and momentum) augmented with the level, slope and curvature of the interest rate term structure is used to examine the pricing of Australian financial stocks. The interest rate factors have not been previously considered for pricing Australian stocks within the Fama–French framework. Consistent with US evidence, we use a system-based estimation to show that the size and book-to-market factors are not priced in the cross section of the equity returns of Australian financial stocks. Momentum and term spread are priced in the equity returns of both financial and nonfinancial stocks. These findings are robust to the inclusion of control variables such as default spread, the inflation rate and a dummy variable for the global financial crisis.     

Managing invasive alien species with professional and hobby farmers: Insights from ecological-economic modelling

Biosecurity is a great challenge to policy-makers globally. Biosecurity policies aim to either prevent invasions before they occur or to eradicate and/or effectively manage the invasive species and diseases once an invasion has occurred. Such policies have traditionally been directed towards professional producers in natural resource based sectors, including agriculture. Given the wide scope of issues threatened by invasive species and diseases, it is important to account for several types of stakeholders that are involved. We investigate the problem of an invasive insect pest feeding on an agricultural crop with heterogeneous producers: profit-oriented professional farmers and utility-oriented hobby farmers. We start from an ecological-economic model conceptually similar to the one developed by Eiswerth and Johnson [Eiswerth, M.E. and Johnson, W.S., 2002. Managing nonindigenous invasive species: insights from dynamic analysis. Environmental and Resource Economics 23, 319-342.] and extend it in three ways. First, we make explicit the relationship between the invaded state carrying capacity and farmers' planting decisions. Second, we add another producer type into the framework and hence account for the existence of both professional and hobby farmers. Third, we provide a theoretical contribution by discussing two alternative types of equilibria. We also apply the model to an empirical case to extract a number of stylised facts and in particular to assess: a) under which circumstances the invasion is likely to be not controllable; and b) how extending control policies to hobby farmers could affect both types of producers.     

Identifying,preventing and controlling invasive plant species using their physiological traits

A model of a plant community that is biologically reasonable and easily adaptable to economic models is presented. The model includes optimization, competition, stochastic limiting resources, and identification of redundant and invasive species. Species exhibit a rich array of traits that make them suited for some set of environmental factors and not for other sets. And because environmental factors are constantly changing, species that are very successful under one set of factors become redundant under another set, implying that an ecosystem needs redundant species as insurance. Invasive species are the flip side of redundant species as they are successful, at least under some environmental conditions. Identification depends on four physiological parameters defining each plant: two respiration parameters, a parameter that gives the plant's ideal level of the stochastic limiting resource, and the specific leaf area. The parameters are terms in an expression that gives the net energy intake of an individual plant, and the plant behaves as if it optimizes this by choosing its individual biomass. Success of species is judged based on the biomass of the species in steady state. An application extends the range management literature by incorporating the model into a rangeland manager's decision problem extends the range management literature. The model allows for multiple plant species, addresses the influence of limiting resources (other than density dependence), and tracks the response of the entire system to human and natural system perturbations. The methods allow simple predictions of community composition in the face of jointly determined economic/ecological behavior. The power of the method is demonstrated through stylized examples of alternative invasion control techniques.     

防治外来生物入侵的法律对策思考

外来入侵物种是指从自然分布区通过有意或无意的人为活动而被引入,在当地的自然或半自然生态系统中形成了自我再生能力、给当地的生态系统或景观造成明显的影响的物种。外来入侵物种在当地定植、①扩展并产生一定影响的过程称为生物入侵。它们对入侵地的生态安全、经济发展以及人类健康造成了巨大的生态灾难和经济损失,因此,引起了人们广泛的关注。然而,由于缺乏对入侵生物的综合性认识,对于控制入侵生物措施的研究也才刚刚起步,还没有系统的控制外来入侵生物的有关程序与法规。为了保护中国的生物多样性,维护生态安全,亟须加快中国在这一领域的立法步伐。     

A Characterization of Australian Unemployment Compensation: An Analysis of Labour Market Adjustment*

This paper uses a labour contracting framework to analyze the microeconomics of the Australian unemployment compensation system. We find that employers adjust labour inputs by using layoffs rather than shortened workweeks or work-sharing during economic recessions. Increases in government benefits tend to reinforce this result Countervailing influences are shown to be the severity of the income test applying to benefits eligibility and the Family Allowance Supplement in its role as supplementing the income of low-income families.