Data/hora: 07/06/2024 06:36:25

Provedor de dados: | Research in Agricultural & Applied Economics (AgEcon Searh)
País: | United States
Título: | Coordinating to Eradicate Animal Disease, and the Role of Insurance Markets
Autores: | Hennessy,   David A.
Data: | 2008-01-14
Ano: | 2007
Palavras-chave: | Biosecurity; Coordination failure; Disease insurance; Endemic disease; Global games; Market access; Public information; Veterinary public health; Livestock Production/Industries; D8; H4; Q1.
Resumo: | Farmed animal production has traditionally been a dispersed sector. Biosecurity actions relevant to eradicating infectious diseases are generally non-contractible, and might involve inordinately high transactions costs if they were contractible. If an endemic disease is to be eradicated within a region, synchronized actions need to be taken to reduce incidence below a critical mass so that spread can be contained. Using a global game model of coordination under public and private information concerning the critical mass required, this paper characterizes the success probability in an eradication campaign. As is standard in global games, heterogeneity in private signals can support a unique equilibrium. Partly because of strategic interactions, concentrated production is found to facilitate eradication whenever unit participation costs are decreasing. Policies to manipulate the critical mass have both a direct effect and a strategic coordination effect. Policies to manipulate information can have subtle and non-intuitive consequences. A program to keep disease out can be modeled similarly. It is shown, too, that coordination problems may lead to multiple equilibria in animal disease insurance markets, so that these markets may complicate a disease eradication program by creating opportunities for multiple inefficient equilibria. The presence of private insurance markets may facilitate coordination and, for good or ill, can seal the fate of a program.
Tipo: | Working or Discussion Paper
Idioma: | Inglês

Identificador:

28968

http://purl.umn.edu/7702

Editor: | AgEcon Search

Relação:

Iowa State University&gt;Center for Agricultural and Rural Development&gt;CARD Working Paper Series

CARD Working Paper 07-WP 457

Formato:

20

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