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Public–Private Partnerships for Biosecurity: An Opportunity for Risk Sharing
Author(s) -
MatoAmboage Rosa,
Pitchford Jonathan W.,
Touza Julia
Publication year - 2019
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/1477-9552.12315
Subject(s) - biosecurity , private sector , government (linguistics) , business , compensation (psychology) , payment , incentive , public economics , risk management , control (management) , public relations , economics , finance , economic growth , political science , management , psychology , ecology , linguistics , philosophy , psychoanalysis , biology , microeconomics
Private efforts to prevent and control biological pests and infectious diseases can be a public good, and so incentivising private biosecurity management actions is both desirable and problematic. Compensation contracts can encourage biosecurity efforts, provide support against the collapse of economic sectors, and create an insurance network. We conceptualise a novel biosecurity instrument relying on formal compensation private–public partnerships using contract theory. Our framework explains how the public sector can harness increased private biosecurity measures by making payments to agents which depend both on their performance and that of the other stakeholders. Doing so allows the government to spread the risk across signatory agents. The framework also improves our understanding of government involvement due to public effects of biosecurity, influenced by the private agents’ capacity to derive private benefit from their own efforts on monitoring and control. Lastly, these theoretical results provide a foundation for further study of contractual responsibility sharing for pest management.