Files

Abstract

The basic hypothesis of this study is that producers do not realize, individually, the importance of adopting preventive measures, even aware of the economic risks for them and for the local economy, because outbreaks of some diseases are not frequent. Moreover, the presence of externalities makes the action of one producer regarding sanitary measures of the herd affect other producers in the same region, which cannot be perceived by them, either. This study aims to develop a theoretical procedure to infer about strategic decisions taken by producers to prevent animal disease in their herds, in face of the risk of contamination. The development of the model is based on the Game Theory, and the cost-benefit analysis as support for decision-making process. After modeling the problem and determining the equilibriums, they are used to elaborate inferences about possible actions of the government through economic incentives (such as indemnities and fines) to encourage the prevention. Then, the theoretical model is applied to a specific case of a foot-and-mouth disease (FMD) outbreak in Brazil. Results indicate that with the absence of a differentiated market for non-vaccinated animals, the game equilibrium tends to the situation in which decisions of producer are to vaccinate their herd, suggesting that government intervention is not necessary. In practice, however, the Brazilian government uses incentive policies for cattle vaccination since some producers do not vaccinate their animals, despite their awareness of the risks, which suggests lack of rationality.

Details

Downloads Statistics

from
to
Download Full History