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Dynamic Sanitary and Phytosanitary Trade Policy

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Author Info

  • Lars J. Olson

    ()
    (University of Maryland, College Park, Maryland.)

  • Santanu Roy

    ()
    (Southern Methodist University, Dallas, Texas.)

Abstract

This paper characterizes the optimal use of sanitary and phytosanitary standards to prevent the introduction of harmful pests and diseases through international trade. Because established pest and disease infestations grow and spread over time their introduction has intertemporal consequences. In a dynamic economic model, an efficient trade policy balances the costs of SPS measures against the discounted stream of the costs of control and social damages that are avoided by using SPS measures, where future growth and spread of any established infestation is accounted for. We examine when phytosanitary trade policy makes good economic sense, when it is efficient to provide full protection against pests and diseases, and when restrictive, but not fully protective trade policy is efficient.

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File URL: ftp://ftp1.economics.smu.edu/WorkingPapers/2008/SROY/SROY-2008-08-2.pdf
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Bibliographic Info

Paper provided by Southern Methodist University, Department of Economics in its series Departmental Working Papers with number 0806.

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Date of creation: Aug 2008
Date of revision:
Handle: RePEc:smu:ecowpa:0806

Contact details of provider:
Postal: Department of Economics, P.O. Box 750496, Southern Methodist University, Dallas, TX 75275-0496
Phone: 214-768-2715
Fax: 214-768-1821
Web page: http://www.smu.edu/economics

Related research

Keywords: International trade; pests and diseases; invasive species; sanitary and phytosanitary trade policy.;

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References

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  1. Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 162, Princeton, Woodrow Wilson School - Public and International Affairs.
  2. Glauber, Joseph W. & Narrod, Clare A., 2001. "A Rational Risk Policy for Regulating Plant Diseases and Pests," 2001 Conference (45th), January 23-25, 2001, Adelaide 125644, Australian Agricultural and Resource Economics Society.
  3. Copeland, Brian R & Taylor, M Scott, 1995. "Trade and Transboundary Pollution," American Economic Review, American Economic Association, vol. 85(4), pages 716-37, September.
  4. Beghin, John C. & Bureau, Jean-Christophe, 2001. "Quantitative Policy Analysis of Sanitary, Phytosanitary and Technical Barriers to Trade," Staff General Research Papers 5119, Iowa State University, Department of Economics.
  5. Calvin, Linda & Krissoff, Barry, 1998. "Technical Barriers To Trade: A Case Study Of Phytosanitary Barriers And U.S. - Japanese Apple Trade," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(02), December.
  6. Christopher Costello & Carol McAusland, 2003. "Protectionism, Trade, and Measures of Damage from Exotic Species Introductions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 964-975.
  7. Olson, Lars J., 2006. "The Economics of Terrestrial Invasive Species: A Review of the Literature," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 35(1), April.
  8. Albert K. A. Acquaye & Julian M. Alston & Hyunok Lee & Daniel A. Sumner, 2005. "Economic Consequences of Invasive Species Policies in the Presence of Commodity Programs: Theory and Application to Citrus Canker ," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(3), pages 498-504.
  9. repec:reg:wpaper:408 is not listed on IDEAS
  10. Whalley, John, 1991. "The Interface between Environmental and Trade Policies," Economic Journal, Royal Economic Society, vol. 101(405), pages 180-89, March.
  11. repec:reg:ranaly:408 is not listed on IDEAS
  12. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249, April.
  13. Lars J. Olson & Santanu Roy, 2002. "The Economics of Controlling a Stochastic Biological Invasion," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(5), pages 1311-1316.
  14. Roberts, Donna & Josling, Timothy E. & Orden, David, 1999. "A Framework for Analyzing Technical Trade Barriers in Agricultural Markets," Technical Bulletins 33560, United States Department of Agriculture, Economic Research Service.
  15. Lars Olson & Santanu Roy, 2008. "Controlling a biological invasion: a non-classical dynamic economic model," Economic Theory, Springer, vol. 36(3), pages 453-469, September.
  16. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521311120, April.
  17. Norbert L. W. Wilson & Jes�s Ant�n, 2006. "Combining Risk Assessment and Economics in Managing a Sanitary-Phytosanitary Risk," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(1), pages 194-202.
  18. Margolis, Michael & Shogren, Jason F. & Fischer, Carolyn, 2005. "How trade politics affect invasive species control," Ecological Economics, Elsevier, vol. 52(3), pages 305-313, February.
  19. McAusland, Carol & Costello, Christopher, 2004. "Avoiding invasives: trade-related policies for controlling unintentional exotic species introductions," Journal of Environmental Economics and Management, Elsevier, vol. 48(2), pages 954-977, September.
  20. Philip L. Paarlberg & John G. Lee, 1998. "Import Restrictions in the Presence of a Health Risk: An Illustration Using FMD," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 175-183.
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Citations

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Cited by:
  1. Chalak, Morteza & Pannell, David J. & Polyakov, Maksym, 2011. "Economics of Controlling Invasive Species: A Stochastic Optimisation Model for a Spatial-Dynamic Process," 2011 Conference, August 25-26, 2011, Nelson, New Zealand 115513, New Zealand Agricultural and Resource Economics Society.
  2. Liu, Yanxu & Sims, Charles, 2013. "Spatial-Dynamic Externalities and Coordination in Invasive Species Control," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151293, Agricultural and Applied Economics Association.
  3. Dalmazzone Silvana & Giaccaria Sergio, 2012. "Economic drivers of biological invasions: A worldwide, bio-geographical analysis," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201215, University of Turin.

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