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Biotechnology and Pest Resistance: An Economic Assessment of Refuges

Author

Listed:
  • Terrance M. Hurley
  • Bruce A. Babcock
  • Richard L. Hellmich

Abstract

Biologists now engineer transgenic crop varieties that offer farmers a new tool for effectively managing pests. Concern over pest resistance, however, has prompted the Environmental Protection Agency to require resistance management plans. This paper develops an economic model of pest management with pest resistance to estimate the constant proportion of cropland planted in refuge that maximizes farm income over a fixed planning horizon. Results indicate a clear economic tradeoff between the pest control benefits of a transgenic variety and the resistance management benefits afforded by refuge.

Suggested Citation

  • Terrance M. Hurley & Bruce A. Babcock & Richard L. Hellmich, 1997. "Biotechnology and Pest Resistance: An Economic Assessment of Refuges," Center for Agricultural and Rural Development (CARD) Publications 97-wp183, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    • Handle: RePEc:ias:cpaper:97-wp183
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    References listed on IDEAS

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    1. Uri Regev & Andrew P. Gutierrez & Gershon Feder, 1976. "Pests as a Common Property Resource: A Case Study of Alfalfa Weevil Control," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(2), pages 186-197.
    2. Regev, Uri & Shalit, Haim & Gutierrez, A. P., 1983. "On the optimal allocation of pesticides with increasing resistance: The case of alfalfa weevil," Journal of Environmental Economics and Management, Elsevier, vol. 10(1), pages 86-100, March.
    3. D. Hueth & U. Regev, 1974. "Optimal Agricultural Pest Management with Increasing Pest Resistance," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(3), pages 543-552.
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    Cited by:

    1. Hurley, Terrance M. & Mitchell, Paul D. & Rice, Marlin E., 2001. "What Is The Value Of Bt Corn?," 2001 Annual meeting, August 5-8, Chicago, IL 20476, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Simpson, R. David & Laxminarayan, Ramanan, 2000. "Biological Limits on Agricultural Intensification: An Example from Resistance Management," RFF Working Paper Series dp-00-43, Resources for the Future.
    3. Paul D. Mitchell & Terrance M. Hurley & Richard L. Hellmich, 2000. "Economic Evaluation of Bt Corn Refuge Insurance," Center for Agricultural and Rural Development (CARD) Publications 00-wp243, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    4. Terrance Hurley & Silvia Secchi & Bruce Babcock & Richard Hellmich, 2002. "Managing the Risk of European Corn Borer Resistance to Bt Corn," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(4), pages 537-558, August.
    5. Grimsrud, Kristine M. & Huffaker, Ray G., 2001. "Optimal Control Of Pest Resistance To Transgenic Crop Varieties," 2001 Annual meeting, August 5-8, Chicago, IL 20452, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Hyde, Jeffrey & Martin, Marshall A. & Preckel, Paul V. & Buschman, Lawrent L. & Edwards, C. Richard & Sloderbeck, Phillip E. & Higgins, Randall A., 2003. "The Value of Bt Corn in Southwest Kansas: A Monte Carlo Simulation Approach," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(1), pages 1-19, April.
    7. Babcock, Bruce A. & Secchi, Silvia, 1999. "Managing Pest Resistance: The Potential Of Crop Rotations And Shredding," 1999 Annual meeting, August 8-11, Nashville, TN 21597, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Secchi, Silvia, 2000. "Economic issues in resistance management," ISU General Staff Papers 2000010108000013359, Iowa State University, Department of Economics.
    9. Laxminarayan, Ramanan & Simpson, R. David, 2000. "Biological Limits on Agricultural Intensification: An Example from Resistance Management," Discussion Papers 10914, Resources for the Future.
    10. Hurley, Terrance M. & Secchi, Silvia & Hellmich, Richard L., 1999. "Managing The Risk Of European Corn Borer Resistance To Transgenic Corn: An Assessment Of Controversial Refuge Recommendations," 1999 Annual meeting, August 8-11, Nashville, TN 21606, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Secchi, Silvia & Babcock, Bruce A., 1999. "A Model Of Pesticide Resistance As A Common Property And Exhaustible Resource," 1999 Annual meeting, August 8-11, Nashville, TN 21664, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    12. Ramanan Laxminarayan & R. Simpson, 2002. "Refuge Strategies for Managing Pest Resistance in Transgenic Agriculture," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(4), pages 521-536, August.

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