Regulation of a spatial externality: Refuges versus tax for managing pest resistance

Stefan Ambec (1, 2) , Marion Desquilbet (3)

1 LERNA - Economie des Ressources Naturelles
2 GU - Göteborgs Universitet = University of Gothenburg
3 GREMAQ - Groupe de recherche en économie mathématique et quantitative

We examine regulations for managing pest resistance to pesticide varieties in a temporally and spatially explicit framework. We compare the performance of the EPA's mandatory refuges and a tax (or subsidy) on the pesticide variety under several biological assumptions on pest mobility and the heterogeneity of farmers' pest vulnerability. We find that only the tax (or subsidy) restores efficiency if pest mobility is perfect within the area. If pest mobility is imperfect and when farmers face identical pest vulnerability, only the refuge might restore efficiency. With simulations we illustrate that complex outcomes may arise for intermediate levels of pest mobility and farmers' heterogeneity. Our results shed light on the choice of regulatory instruments for common-pool resource regulations where spatial localization matters.

Mots clés: transgenic crop; refuge; spatial

Mots clés: pest resistance; pesticides; tax; externalities

Domaines: Sciences de l'Homme et Société

Stefan Ambec, Marion Desquilbet. Regulation of a spatial externality: Refuges versus tax for managing pest resistance. Environmental and Resource Economics, 2012, 51 (1), pp.79-104. ⟨10.1007/s10640-011-9489-3⟩. ⟨hal-02652045⟩