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Regional economic impacts of a plant disease incursion using a general equilibrium approach

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  • Wittwer, Glyn
  • McKirdy, Simon
  • Wilson, Ryan

Abstract

The present study uses a dynamic multiregional computable general equilibrium (CGE) model to estimate the micro- andmacroeconomic effects of a hypothetical disease or pest outbreak. Our example is a Karnal bunt incursion in wheat in Western Australia. The extent of the incursion, the impact of the disease or pest on plant yields, the response of buyers, the costs of eradication and the time path of the scenario contribute to outcomes at the industry, regional, state and national levels. We decompose the contribution of these individual direct effects to the overall impact of the incursion. This might provide some guidance regarding areas for priority in attempting to eradicate or minimise the impacts of a disease or pest. The study also introduces a theory of dynamic regional labour adjustment in which economic events may lead to both real wage differentials and worker migration between regions.

Suggested Citation

  • Wittwer, Glyn & McKirdy, Simon & Wilson, Ryan, 2005. "Regional economic impacts of a plant disease incursion using a general equilibrium approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(1), pages 1-15.
    • Handle: RePEc:ags:aareaj:118438
    DOI: 10.22004/ag.econ.118438
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    1. James, Sallie & Anderson, Kym, 1998. "On the need for more economic assessment of quarantine/SPS policies," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 42(4), pages 1-20.
    2. Brennan, John P. & Thorne, Fiona S. & Kelly, Paul W. & Murray, Gordon M., 2004. "Defining the Costs of an Outbreak of Karnal Bunt of Wheat," 2004 Conference (48th), February 11-13, 2004, Melbourne, Australia 58382, Australian Agricultural and Resource Economics Society.
    3. Xueyan Zhao & Kym Anderson & Glyn Wittwer, 2019. "Who Gains from Australian Generic Wine Promotion and R&D?," World Scientific Book Chapters, in: Kym Anderson (ed.), The International Economics of Wine, chapter 9, pages 189-223, World Scientific Publishing Co. Pte. Ltd..
    4. Philip D. Adams & Mark Horridge & Glyn Wittwer, 2003. "MMRF-GREEN: A Dynamic Multi-Regional Applied General Equilibrium Model of the Australian Economy, Based on the MMR and MONASH Models," Centre of Policy Studies/IMPACT Centre Working Papers g-140, Victoria University, Centre of Policy Studies/IMPACT Centre.
    5. Naqvi, Farzana & Peter, Matthew W, 1996. "A Multiregional, Multisectoral Model of the Australian Economy with an Illustrative Application," Australian Economic Papers, Wiley Blackwell, vol. 35(66), pages 94-113, June.
    6. Oecd, 2002. "Access for Business," OECD Digital Economy Papers 67, OECD Publishing.
    7. Mark Horridge & John Madden & Glyn Wittwer, 2003. "Using a highly disaggregated multi-regional single-country model to analyse the impacts of the 2002-03 drought on Australia," Centre of Policy Studies/IMPACT Centre Working Papers g-141, Victoria University, Centre of Policy Studies/IMPACT Centre.
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    Cited by:

    1. David C. Cook & Rob W. Fraser & Jeffrey K. Waage & Matthew B. Thomas, 2009. "Prioritising Biosecurity Investment between Protecting Agricultural and Environmental Systems," Studies in Economics 0908, School of Economics, University of Kent.
    2. David C Cook & Shuang Liu & Jacqueline Edwards & Oscar N Villalta & Jean-Philippe Aurambout & Darren J Kriticos & Andre Drenth & Paul J De Barro, 2012. "Predicting the Benefits of Banana Bunchy Top Virus Exclusion from Commercial Plantations in Australia," PLOS ONE, Public Library of Science, vol. 7(8), pages 1-9, August.
    3. Wittwer, Glyn & Griffith, Marnie, 2011. "Modelling drought and recovery in the southern Murray-Darling basin," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), pages 1-18, September.
    4. Adamson, David & Cook, David, 2007. "Re-examining economic options for import risk assessments," Risk and Sustainable Management Group Working Papers 149869, University of Queensland, School of Economics.
    5. Glyn Wittwer & Simon McKirdy & Ryan Wilson, 2006. "Analysing a hypothetical Pierce's disease outbreak in South Australia using a dynamic CGE approach," Centre of Policy Studies/IMPACT Centre Working Papers g-162, Victoria University, Centre of Policy Studies/IMPACT Centre.
    6. Giesecke, James A. & Madden, John R., 2013. "Regional Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 379-475, Elsevier.
    7. Borrell, Brent & Jiang, Tingsong & Pearce, David & Gould, Ian, 2014. "Payoffs from research and development along the Australian food value chain: a general equilibrium analysis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 58(3), July.
    8. Cook, David & Carrasco, Luis Roman & Paini, Dean & Fraser, Rob, 2011. "Estimating the social welfare effects of New Zealand apple imports," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(4), pages 1-22.
    9. George Verikios, 2018. "Capital Account Liberalisation by China and the Effects on Global FDI and Trade," Global Economic Review, Taylor & Francis Journals, vol. 47(3), pages 245-269, July.
    10. Tarek Soliman & Monique C M Mourits & Wopke van der Werf & Geerten M Hengeveld & Christelle Robinet & Alfons G J M Oude Lansink, 2012. "Framework for Modelling Economic Impacts of Invasive Species, Applied to Pine Wood Nematode in Europe," PLOS ONE, Public Library of Science, vol. 7(9), pages 1-12, September.
    11. George Verikios & Xiao-guang Zhang, 2016. "Structural change and income distribution: the case of Australian telecommunications," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 21(4), pages 549-570, October.
    12. Wittwer, Glyn & Vere, David T. & Jones, Randall E. & Griffith, Garry R., 2005. "Dynamic general equilibrium analysis of improved weed management in Australia's winter cropping systems," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(4), pages 1-15.
    13. Carrasco, L. Roman & Cook, David & Baker, Richard & MacLeod, Alan & Knight, Jon D. & Mumford, John D., 2012. "Towards the integration of spread and economic impacts of biological invasions in a landscape of learning and imitating agents," Ecological Economics, Elsevier, vol. 76(C), pages 95-103.
    14. Verikios, George & Zhang, Xiao-guang, 2015. "Reform of Australian urban transport: A CGE-microsimulation analysis of the effects on income distribution," Economic Modelling, Elsevier, vol. 44(C), pages 7-17.
    15. Verikios, George & Patron, Jodie & Gharibnavaz, Reza, 2017. "Decomposing the Marginal Excess Burden of Australia’s Goods and Services Tax," MPRA Paper 77850, University Library of Munich, Germany.
    16. Verikios, George & Zhang, Xiao-guang, 2013. "Structural change in the Australian electricity industry during the 1990s and the effect on household income distribution: A macro–micro approach," Economic Modelling, Elsevier, vol. 32(C), pages 564-575.
    17. repec:ags:aare05:139327 is not listed on IDEAS
    18. Daeyoung Kwon & Soyoon Kim & Yongjoon Kim & Minsu Son & Kwansoo Kim & Donghwan An & Brian H. S. Kim, 2015. "An Empirical Assessment of the Economic Damage Caused by Apple Marssonina Blotch and Pear Scab Outbreaks in Korea," Sustainability, MDPI, vol. 7(12), pages 1-11, December.
    19. Alan MacLeod & Glyn Jones & Helen Anderson & Rick Mumford, 2016. "Plant health and food security, linking science, economics, policy and industry," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 8(1), pages 17-25, February.
    20. Alan MacLeod & Glyn D. Jones & Helen M. Anderson & Rick A. Mumford, 2016. "Plant health and food security, linking science, economics, policy and industry," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 8(1), pages 17-25, February.
    21. Cook, David C. & Lonsdale, Mark, 2006. "A strategic protection approach to biosecurity: Policy implications of an ‘immune system’ model for addressing the risks and consequences of invasive species," 2006 Conference (50th), February 8-10, 2006, Sydney, Australia 174469, Australian Agricultural and Resource Economics Society.
    22. Gasiorek, Michael & Holmes, Peter & Rollo, Jim & Wang, Zhenkun & Gonzalez, Javier Lopez & Parra, Maximiliano Mendez & Maliszewska, Maryla & Paczynski, Wojtek & Cirera, Xavier & Willenbockel, Dirk & Fo, 2010. "Mid-term Evaluation of the EU’s Generalised System of Preferences," Conference papers 331999, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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