The Economics of Controlling a Biological Invasion

University of Maryland Dept. of Agricultural & Resource Economics Working Paper No. 03-06

35 Pages Posted: 23 Jul 2003

See all articles by Lars J. Olson

Lars J. Olson

University of Maryland - Department of Agricultural & Resource Economics

Santanu Roy

Southern Methodist University (SMU) - Department of Economics

Date Written: May 2003

Abstract

The paper develops a simple economic model of a biological invasion. The natural growth of the invasion is non-convex and the immediate cost of controlling the invasion depends on the level of current control as well as the current size of the invasion. Greater control raises control costs today while reducing damages - now and in the future. In addition, by decreasing the size of the invasion, increased control today raises the marginal cost of control in the future. As a consequence, the optimal path of an invasion is not necessarily monotonic. When the marginal control cost declines sharply with the size of invasion, it may be optimal to allow an invasion to grow naturally before it is controlled. We characterize conditions under which it is optimal to eradicate an invasive species (immediately and eventually) and conditions under which it is optimal to manage an invasion without complete eradication.

Keywords: Biological invasion, invasive species, eradication, renewable resource economics

JEL Classification: Q20, D99

Suggested Citation

Olson, Lars J. and Roy, Santanu, The Economics of Controlling a Biological Invasion (May 2003). University of Maryland Dept. of Agricultural & Resource Economics Working Paper No. 03-06, Available at SSRN: https://ssrn.com/abstract=421007 or http://dx.doi.org/10.2139/ssrn.421007

Lars J. Olson (Contact Author)

University of Maryland - Department of Agricultural & Resource Economics ( email )

2200 Symons Hall
College Park, MD 20742-5535
United States
301-405-7180 (Phone)

Santanu Roy

Southern Methodist University (SMU) - Department of Economics ( email )

Dallas, TX 75275
United States

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