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Regional economic impacts of a plant disease incursion using a general equilibrium approach *
Author(s) -
Wittwer Glyn,
McKirdy Simon,
Wilson Ryan
Publication year - 2005
Publication title -
australian journal of agricultural and resource economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.683
H-Index - 49
eISSN - 1467-8489
pISSN - 1364-985X
DOI - 10.1111/j.1467-8489.2005.00276.x
Subject(s) - computable general equilibrium , pest analysis , economic impact analysis , wage , outbreak , economics , general equilibrium theory , natural resource economics , geography , agricultural economics , business , macroeconomics , microeconomics , biology , labour economics , marketing , virology
The present study uses a dynamic multiregional computable general equilibrium (CGE) model to estimate the micro‐ and macroeconomic effects of a hypothetical disease or pest outbreak. Our example is a Karnal bunt incursion in wheat in Western Australia. The extent of the incursion, the impact of the disease or pest on plant yields, the response of buyers, the costs of eradication and the time path of the scenario contribute to outcomes at the industry, regional, state and national levels. We decompose the contribution of these individual direct effects to the overall impact of the incursion. This might provide some guidance regarding areas for priority in attempting to eradicate or minimise the impacts of a disease or pest. The study also introduces a theory of dynamic regional labour adjustment in which economic events may lead to both real wage differentials and worker migration between regions.