Contaminated water spillovers or peer effects? Determinants of disease outbreaks in shrimp farming in Vietnam

Disease outbreaks are one of the major issues in the aquaculture sector and can lead to significant economic losses. Although the source of the disease is difficult to trace, understanding how it occurs is important to mitigate the problem. A crucial factor that has not received sufficient attention is the presence of spillovers among fish farmers connected by waterways. This study examines the presence of spillovers among shrimp farmers in Southern Vietnam based on primary data. In particular, it quantifies the effects of contaminated water spillovers from one farm to another and the peer effects of farming practices among neighbors. We solve the reflection problem by employing a method developed in social network analyses. The findings indicate that a farmer's practices are affected by their neighbors’ farming practices. Further, the disease outbreak in a farmer's pond is affected by those in their neighbors’ ponds, even after controlling for contextual peer effects and correlated effects. The negative effects of neighbors’ ponds on the probability of disease outbreaks in a farmer's pond may offset the positive effects of the farmer's good farming practices, suggesting the importance of considering neighboring farmers as a group when addressing the issue of disease control.