Economic incentives for disease control and zoning strategies for mitigating salmon lice and pancreas disease in salmonid aquaculture

Salmon lice and pancreas disease represent two important disease challenges in the Norwegian salmonid aquaculture industry despite continuous efforts to reduce disease impact. Various measures, including implementation of different zoning structures, may be used in an effort to improve disease control. A range of control policies may disadvantage individual companies and regions and it is therefore important to be able to demonstrate the economic consequences of such measures, both for individual companies and for the industry in general. Successful implementation of control measures is dependent on industry uptake and cooperation, and the use of incentive programs is one way of increasing the likelihood of success. Incentive programs have been widely used in terrestrial livestock industries in most parts of the world and are well described in scientific literature. Contrary to the livestock sector, incentive programs have rarely been used towards the aquaculture industry. A literature review shows a very limited use of incentive strategies in disease control in aquaculture and that specific factors such as the multi-stakeholder use of a common good (the coastline or a large waterbody) and the sharing of the "uncontrollable" waterbody negatively impacts the use of incentives for disease control in this sector. Industry interviews further highlights these issues. The feasibility of the implementation of stronger incentives for disease control depends on regional factors, industry collaboration and, possibly, legal adjustments. The cost-effectiveness of control measures strongly depends on the direct cost of the disease in question, the sales prices, the potential impact on national and international trade, as well as the scale against which the strategy is measured. While the cost-effectiveness for a control measure is rarely positive for an individual farm it can be of benefit to a zone or a region. If judged against a national effect and/or the wider socio-economic effect for a coastal society, disease control efforts in the salmonid aquaculture industry may be highly beneficial.

Prosjektet har hatt stor betydning for stipendiatmottakeren. Det har bidratt til vesentlig kompetanseutvikling, samt et betydelig utvidet internasjonalt kontaktnettverk. Utførte samarbeid og invitasjoner til variert internasjonal deltagelse har resultert i ytterligere langsiktige internasjonale og tverrfaglige samarbeid utover prosjektperioden.

Establishing long-term disease mitigation- and production zones requires a change in the salmon-farming infrastructure that may not immediately be suited for the individual company. It is therefore important to demonstrate how such a change economically will impact the industry as well as each company's production function. This post-doctoral research project aims to explore incentives for disease control in aquaculture and evaluate the cost-effectiveness of treatment and control options when structuring the salmon production units into geographical zones. It represents an innovative means to examine the issue of optimal production zones by combining institutional and information economics, experimental economics, and integrated models of epidemiology and economic impact. While focusing primarily on salmon lice, differences between salmon lice and pancreas disease will be explored. A literature review of incentive programs in the livestock sector will synthesize the theoretical literature from economics, operations research and ecology in order to develop practical guidelines for what could constitute an appropriate, fit-for-purpose incentive program in aquatic health and the development of optimal zones. Based on this, experimental economics will be utilized in an innovative and unique setting by developing experiments with focus groups of producers and industry actors to assess farm management reactions to different incentive programs. An integrated epidemiological-economic model based on a system dynamics approach will be employed to evaluate treatment and control strategies at farm level and with different zoning strategies. Issues of industry profitability and organization in the short- and long-term, and the extent to which these effects might feedback to the choice of incentive programs, will be evaluated. The cost-effectiveness of different zoning scenarios, also taking into account non-economic drivers, will then be calculated.