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.