IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v29y2012i5p1921-1930.html
   My bibliography  Save this article

Macroeconomic costs to large scale disruptions of food production: The case of foot- and-mouth disease in the United States

Author

Listed:
  • Boisvert, Richard N.
  • Kay, David
  • Turvey, Calum G.

Abstract

We forecast the economic consequences of a widespread contamination of the food system based on a hypothetical outbreak of foot-and-mouth disease (FMD). Since the immediate effect on the livestock sector could affect the entire supply chain and US livestock, meat and dairy exports, we measure these impacts using GTAP, a multi-region, multi-sector computable general equilibrium (CGE) model of the global economy. The immediate “shocks” to the US livestock, raw milk and other animal products sectors indirectly affect all sectors of the economy, as well as international markets and trade. We decompose these effects due to each component of the initial shocks, and estimate the importance of these shocks to the national food system for the Mid-Atlantic Region using IMPLAN. Our GTAP results indicate that losses to the USA economy would be about $11.7 billion, and with the ripple effect throughout the rest of the world including beneficiary nations (Argentina, Brazil, Latin America, Australia and New Zealand) and losers (Canada, Mexico, European Union) would be 14.1 billion. We estimate the proportion of the domestic impact affecting the Mid-Atlantic Region. Based on a regional input–output model of that region, we estimate that total losses in value added are nearly $800 million; losses in labor income total about $565 million; and there are job losses of just over 12 thousand.

Suggested Citation

  • Boisvert, Richard N. & Kay, David & Turvey, Calum G., 2012. "Macroeconomic costs to large scale disruptions of food production: The case of foot- and-mouth disease in the United States," Economic Modelling, Elsevier, vol. 29(5), pages 1921-1930.
  • Handle: RePEc:eee:ecmode:v:29:y:2012:i:5:p:1921-1930
    DOI: 10.1016/j.econmod.2012.06.007
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999312001800
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Just, David R. & Wansink, Brian & Turvey, Calum G., 2009. "Biosecurity, Terrorism, and Food Consumption Behavior: Using Experimental Psychology to Analyze Choices Involving Fear," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(1), pages 1-18, April.
    2. Huff, Karen & Meilke, Karl D. & Turvey, Calum G. & Cranfield, John A.L., 2004. "Modeling Bioterrorism in the Livestock Sectors of NAFTA Members," CAFRI: Current Agriculture, Food and Resource Issues, Canadian Agricultural Economics Society, issue 5, pages 1-22, January.
    3. Elbakidze, Levan & McCarl, Bruce A., 2006. "Animal Disease Pre-Event Preparedness versus Post-Event Response: When Is It Economic to Protect?," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 38(02), pages 327-336, August.
    4. Huff, Karen & Thomas W. Hertel, 2001. "Decomposing Welfare Changes in GTAP," GTAP Technical Papers 308, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    5. Peter B. Dixon & Bumsoo Lee & Todd Muehlenbeck & Maureen T. Rimmer & Adam Z. Rose & George Verikios, 2010. "Effects on the U.S. of an H1N1 epidemic: analysis with a quarterly CGE model," Centre of Policy Studies/IMPACT Centre Working Papers g-202, Victoria University, Centre of Policy Studies/IMPACT Centre.
    6. Brockmeier, Martina, 2001. "A Graphical Exposition of the GTAP Model," GTAP Technical Papers 311, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    7. Paarlberg, Philip L. & Hillberg, Ann & Lee, John G. & Mathews, Kenneth H., Jr., 2008. "Economic Impacts of Foreign Animal Disease," Economic Research Report 56453, United States Department of Agriculture, Economic Research Service.
    8. Karl M. Rich & Alex Winter-Nelson, 2007. "An Integrated Epidemiological-Economic Analysis of Foot and Mouth Disease: Applications to the Southern Cone of South America," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(3), pages 682-697.
    9. Brockmeier, Martina, 2001. "A Graphical Exposition Of The Gtap Model," Technical Papers 28706, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Pendell, Dustin L. & Leatherman, John & Schroeder, Ted C. & Alward, Gregory S., 2007. "The Economic Impacts of a Foot-And-Mouth Disease Outbreak: A Regional Analysis," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 39(s1), pages 19-33, October.
    11. Elbakidze, Levan, 2008. "Modeling of Avian Influenza Mitigation Policies Within the Backyard Segment of the Poultry Sector," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 33(2), pages 1-17.
    12. David W. Hughes & David W. Holland, 1994. "Core-Periphery Economic Linkage: A Measure of Spread and Possible Backwash Effects for the Washington Economy," Land Economics, University of Wisconsin Press, vol. 70(3), pages 364-377.
    13. Warwick McKibbin & Alexandra Sidorenko, 2006. "Global Macroeconomic Consequences of Pandemic Influenza," CAMA Working Papers 2006-26, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    14. Lindall, Scott A. & Olson, Douglas C. & Alward, Gregory S., 2006. "Deriving Multi-Regional Models Using the IMPLAN National Trade Flows Model," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(1), pages 1-8.
    Full references (including those not matched with items on IDEAS)

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:29:y:2012:i:5:p:1921-1930. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.