Optimisation methods for assisting policy decisions on endemic diseases

Endemic disease of animals is an economic problem as it deprives humans of scarce resources that might otherwise satisfy human wants. Optimisation methods identify the strategies that minimise this economic problem. Given the potentially vast extent of the deprivation, not only in terms of lost wealth but also in terms of animal welfare, human health and environmental damage, this subject offers great benefits to decision-makers from the individual farm to the global level. This paper uses examples to illustrate the basic economic principles concerned. It shows how these principles may be extended to deal with current limitations in theory and practice. Lack of data is a common problem that may be dealt with by using computer simulation, theoretical approaches or the experiential knowledge of the decision-makers themselves. The latter method has the added advantage of greatly assisting with the difficult problem of effectively communicating the results of decision analysis to the decision-maker. In most situations the decision-maker will need to strike a balance between conflicting objectives such as short term profit and long term environmental damage (sustainability). This problem will require a wider perspective, which is greatly facilitated by collaboration between economists and scientists. The paper illustrates ways in which this has been done by using decision analysis methods to focus on the decision rather than the disease. The conclusions highlight priority areas for future research and development in this area. Topics include the contribution of endemic disease control to sustainable development, endemic disease eradication, capturing wider implications such as animal welfare and food safety, accounting for variation in rational decision making and dealing with risk.Economics, decision analysis, optimisation, modelling, endemic disease, knowledge transfer, Health Economics and Policy,

A Structural Equation Model of the Factors Influencing British Consumers’ Behaviour towards Animal Welfare

Results of national and pan-European consumer surveys and the growth in the demand for so-called “animal friendly” food products suggest that consumers within the European Union show a high level of concern for the welfare of farm animals. This paper analyses the determinants of British consumers’ behaviour towards animal welfare using structural equation models (SEM) with observed and latent variables. SEM is a statistical technique for testing and estimating relationships amongst variables, using a combination of statistical data and qualitative causal assumptions. We used a data set collected in 2005 through face-to-face interviews of 654 consumers in England. We analysed the range of statements in existing literature on consumers’ behaviour towards animal welfare and then used SEM to test and estimate these a priori determinants of behaviour. The models include observed and latent variables representing behaviour (stated purchases of free-range and organic chicken meat) and its underlying determinants (attitudes towards animal welfare and socio-economic factors). The models have an adequate overall fit to the data. The significance tests for the structural equation model on free-range chicken meat purchasing behaviour show socioeconomic group, education, attitudes towards animal welfare, reasons for buying chicken meat, access to information on animal welfare issues, number of children and price as significant determinants. All of these (with the exception of reasons for buying chicken meat) were found significant also in the model on organic chicken meat purchasing behaviour.animal welfare, consumers’ behaviour, structural equation models., Agricultural and Food Policy,

ANIMAL WELFARE AND ECONOMIC OPTIMISATION OF FARROWING SYSTEMS

Livestock Production/Industries, alternative housing systems, animal welfare, economic optimisation, farrowing systems, pig,

A PARTIAL EQUILIBRIUM MODEL OF THE LINKAGES BETWEEN ANIMAL WELFARE, TRADE AND THE ENVIRONMENT IN SCOTLAND

This research analyses the impacts of a scientific advance that improves animal welfare, upon the environment and trade in Scotland using partial equilibrium (PE) modelling. The science improves pig neonatal survival through improved (high fibre) sow diets used before mating. Our model simulates the effects of animal welfare changes on the pig production systems (pig meat) and further on trade flows (trade in pig meat) and environment (water and air pollution). We consider two animal welfare simulation scenarios, namely the status quo – no animal welfare change as regards pig neonatal mortality (baseline scenario) and the case of improving pig neonatal survival (alternative scenario) and compare the impacts on trade and environment between the two scenarios during the simulation horizon 2008-2015. The results show that the increase in animal welfare has a lower impact on the environment in the alternative scenario compared to the baseline scenario (by about 6% at the end of the simulation horizon) and a positive impact on net trade in the alternative scenario compared to the baseline scenario (by about 13% at the end of the simulation horizon).Pig Welfare, Trade, Environment, Scotland, Partial Equilibrium Model., Agricultural and Food Policy, Environmental Economics and Policy, Research Methods/ Statistical Methods, Q18, Q50,

Winners and losers from Johne’s disease eradication from the Scottish dairy herd: a Markov-Chain simulation

In this paper, we evaluated the welfare effects of a hypothetical programme of Johne's disease eradication from the Scottish dairy herd on different stakeholders in the domestic milk market. We undertook the evaluation using a Markov-Chain simulation and applying an economic welfare analysis which takes into consideration the effects of an eradication programme on product price, on output quantity, on cost and on milk yield for given levels of supply and demand elasticities. We found that, following the eradication of the disease, milk yield per cow increased for all herd sizes in Scotland whereas price and unit cost of milk production fell. Consequently, milk consumers gained around £14.3 million in discounted economic surplus and producers with infected herds around £13.4 million whereas producers with uninfected herds lost around £10.7 million in discounted surplus. The gain in surplus made by consumers and owners of infected herds, however, more than made up for the loss in surplus made by owners of un-infected herds. Therefore, on balance, Scotland gained a net economic surplus of £17 million from the programme.Johne's, eradication programme, economic welfare effects, economic surplus, I180,

Evaluation of approaches to control of Maedi-Visna disease of sheep using a Markov chain simulation model for a range of typical British Flocks

An epidemiological model is described that closely mimicked results of a published serological study of natural transmission of Maedi-Visna virus in a low ground flock of sheep. We adjusted parameters in the model from this baseline to explore the possible implications for the control of Maedi-Visna virus in typical British flocks. On closed hill farms, low probability of effective contact was most critical for control. In open low ground flocks, purchasing accredited replacements eliminated disease spread, otherwise flock size was the most important factor governing flock prevalence. Results highlighted the need for more epidemiological information about Maedi-Visna, particularly whether hill farms act as a hidden reservoir of virus or reduce the impact of this disease on the industry by providing a source of clean replacementsLivestock Production/Industries, Maedi-Visna, Model, Markov Chain, Sheep, Control,

Trade-offs between conflicting animal welfare concerns and cow replacement strategy in out-wintering Scottish suckler herds

Since decoupling of the CAP, many Scottish suckler cow farms are facing financial difficulties. In response, many farmers are out-wintering extensively managed suckler cows to minimise production costs. These systems are of animal welfare concern. A range of trade-offs between animal welfare indicators and between animal welfare and farm profitability can be identified. A Dynamic Programming (DP) model was developed to study these trade-offs. Two herds were modelled assuming their feeding regimes were either low (LHERD) or high (HHERD). The objective of the DP was to maximise the expected net margin from a current cow and its successors over an infinite time horizon. Preliminary results showed that the rate of voluntary culling was higher in HHERD than in LHERD. Animals in HHERD had shorter life expectancy. The expected net present value was 58% lower in LHERD than HHERD (-£41.5 and -£24.3 respectively). These results suggest a heavier culling rate and shorter longevity for animals in HHERD that compromises animal welfare. Also HHERD had a greater implied stocking density than LHERD. This increase of the cows’ population may adversely affect the environment. The presented model provides some of the basic information required to explore some of the trade-offs between farm profit, animal welfare and the environment.Livestock Production/Industries, Beef cow, economics, dynamic programming, animal welfare,

Managing animal health status information in the cattle market

The paper analyses the problem of information in the cattle market, particularly as it relates to the status of animal health, and discusses ways to limit it with the view to improving social surplus. Against this background, it aims to achieve three major objectives. Firstly, it describes the ways of improving the level of information through such schemes as Conventional Warranties and Third Party Certification and the different choices made by sellers and buyers in the presence of these schemes. Secondly, it studies the various ways by which these schemes make an impact on equilibria in different markets (i.e., the pooling market and the premium market), and, consequently, on the social surplus. Thirdly, it identifies the necessary conditions for a third party/public decision-maker to increase social surplus and reduce the negative externality caused by disease by managing and supporting Third Party Certification. The paper shows that product certification and product warranty cannot coexist because product warranty is suboptimal. It also shows that certification, and a possible supporting of certification or animal testing does not necessarily improve the safety of the trade.Asymmetric information, Third-Party certification, Disease Externalities, Livestock Production/Industries,

Labour Management for Profit and Welfare in Extensive Sheep Farming

Sheep welfare is an emerging topic in research and food marketing, and recent studies suggest that farm labour is a key factor for both animal welfare and productivity in extensive sheep farming systems, although little research has been done into labour utilisation in these systems. This paper reports field data collection on two commercial farms and the use of a linear programming (LP) model to link labour economics and animal welfare analysis. The model maximises the number of ewes to clooked after over the lambing period, when constrained by labour availability for various key tasks and by a pre-determined level of sheep welfare. The results show a trade-off between welfare level and labour input per sheep. Dropping tasks with less significant welfare and productivity consequences is an effective way of increasing carrying capacity (from 977 ewes/shepherd to 1428), as is working longer hours (1174 ewes/shepherd) or only doing the legal minimum of welfare checking (labour reduced from 0.68 min/ewe to 0.44 min/ewe) . The field data suggest that farmers currently provide high welfare, and that, despite much time spent away from the flock (e.g. driving), they spend a large amount of time (39% of total) with their sheep.Labour, Sheep, Linear Programming, Animal Welfare, Livestock Production/Industries, Q10, Q19, Y1,

Measuring the economic benefits and costs of Bluetongue virus outbreak and control strategies in Scotland

This paper provides an ex-ante economic analysis, comparing six alternative control strategies for the eradication of Bluetongue virus 8 against five incursion scenarios in cattle and sheep populations. The economic analysis assumes a common baseline unavoidable cost of public and private measures that together contribute to prevention of incursion of BTV8 into Scotland. These costs continue over the five year horizon of this analysis regardless of whether a BTV8 epidemic ensues in Scotland and their total present value was found to be approximately £141m over the 5year period. The benefit of this investment is the costs of a BTV8 outbreak avoided; which depends on the time, location and nature of the incursion, on the control strategies adopted to counter each incursion, on the persistence of the incursion and on the opportunities to mitigate the damage. Specific variations in all these aspects were explored. The benefit-cost ratios were ranked within each incursion scenario to evaluate the efficiency of control outlays. Although the economic model found that benefit-cost ratios were greater than 1 for all interventions strategies examined, the control strategy option with 100% vaccination and protection zone set at Scottish Borders were economically preferable. This implies that if avoided this control option would deliver the greatest benefit from investment in baseline prevention costs. However, in terms of outbreak losses, this vaccination strategy was always most costly. On the other hand, the control strategy with 50% vaccination and all Scotland as a protection zone often provides the lowest benefits in all control options examinedbluetongue virus, epidemiology, direct and indirect costs, benefit analysis, Risk and Uncertainty,