4) Impacts
b) Economic
Pimentel, Zuniga and Morrison. 2005. Update on the environmental
and economic costs associated with alien-invasive species in
the United States ECOLOGICAL ECONOMICS 52 (3): 273-288
(just read plant-related sections)
4) Impacts
b) Economic
Pimentel, Zuniga and Morrison. 2005. Update on the environmental
and economic costs associated with alien-invasive species in
the United States ECOLOGICAL ECONOMICS 52 (3): 273-288
introduced crops and animals provide 98% US food, $800 billion
value per year
Some species have harmed agriculture, forestry, other economic
segments, and environment.
Estimated 25,000 non-indigenous plants in US; 5000 have escaped
to natural systems
What are the causes of economic loss due to invasives?
4) Impacts
b) Economic
How many aliens?
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
4) Impacts
b) Economic
i) Total damage estimates: annual. From Pimentel et al. (2000)
• United States
Economic impacts from losses/damage
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts from losses/damage and from costs to
control
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts from losses/damage and from costs to
control. Sum to get total.
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts
Focus only on plants
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts
Focus only on plants
For example: Aquatic weeds
Mark W. Skinner @ USDA-NRCS PLANTS Database
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts
Focus only on plants
For example: Crop weeds
Patrick J. Alexander @ USDA-NRCS PLANTS Database
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts
Focus only on plants
For example: Lawns,
gardens, golf courses
Patrick J. Alexander @ USDA-NRCS PLANTS Database
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2000)
• United States
Economic impacts
Focus only on plants: Total ~$34 billion annually
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2001) Ag Ecosys
Environ 84:1-20
• United States
• Global
Losses/damage only from plants: $34 billion for US
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2001) Ag Ecosys
Environ 84:1-20
• United States
• Global
Losses/damage only from plants: $34 billion for US, but India
is even more
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2001) Ag Ecosys
Environ 84:1-20
• United States
• Global
Losses/damage only from plants: $34 billion for US, but India
is even more, and Brazil not far behind
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2001) Ag Ecosys
Environ 84:1-20
• United States
• Global
Losses/damage only from plants: Total ~$95 billion (42% of
total losses from all organisms)
4) Impacts
b) Economic
i) Total damage estimates: From Pimentel et al. (2001) Ag Ecosys
Environ 84:1-20
• United States
• Global
Losses/damage only from plants: Total ~$95 billion (42% of
total losses from all organisms)
But only a small fraction of other environmental losses or
control costs and environmental costs hard to estimate
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness analyses
• aka: Ex post (after the fact) analysis
• Assesses damage from invasives vs. cost of various
methods to control them
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Damage from invasives vs. cost to control them
• Focus generally is on minimizing the cost of controlling to
a certain level of damage – in other words, what is the least
cost method to control an invasion that has already
occurred
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Damage from invasives vs. cost to control them
• Minimize control cost to a certain level of damage – least cost
method to control
• Doesn’t quantify economic benefits of control. Assumes
that the benefits will exceed the least cost method to
control
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Minimize control cost to a certain level of damage – least cost
method to control
• Assumes: benefits > least cost method to control
(2) Ex ante (before the fact) analyses
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Minimize control cost to a certain level of damage – least cost
method to control
• Assumes: benefits > least cost method to control
(2) Ex ante analyses
• Cost – benefit analysis: what are costs to prevent invasion
vs. costs if invasion occurs. Maximizes the cost-benefit
ratio.
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Minimize control cost to a certain level of damage – least cost
method to control
• Assumes: benefits > least cost method to control
(2) Ex ante analyses
• Cost – benefit analysis
• 2-step process:
(a) Understand how invasion affects different species,
ecosystem services, and economic activities
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses
• Minimize control cost to a certain level of damage – least cost
method to control
• Assumes: benefits > least cost method to control
(2) Ex ante analyses
• Cost – benefit analysis
• 2-step process:
(a) Understand how invasion affects different species,
ecosystem services, and economic activities
(b) Assess the monetary value of all these: “valuation”
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values
Consumptive = monetary worth of specific, market-based
goods & services
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values
Consumptive = monetary worth of specific, market-based
goods & services
Often easy to analyze
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values
Consumptive = monetary worth of specific, market-based
goods & services
Often easy to analyze
But need to include both private (financial) and social
(economic) prices
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values
Consumptive = monetary worth of specific, market-based
goods & services
Often easy to analyze
But need to include both private (financial) and social
(economic) prices
Non-consumptive = monetary worth of
non-market goods & services
(for example, tourism, recreational
activities, etc.)
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values
Consumptive = monetary worth of specific, market-based
goods & services
Often easy to analyze
But need to include both private (financial) and social
(economic) prices
Non-consumptive = monetary worth of non-market goods &
services (for example, tourism, recreational activities, etc.)
More difficult to analyze; usually entail indirect
approaches such as “travel cost” or “survey”
methods
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
Even more difficult to assess
“Replacement” costs: cost to replace the services
provided by the intact ecosystem.
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
Even more difficult to assess
“Replacement” costs: cost to replace the services provided
by the intact ecosystem.
e.g. cost of water treatment if wetlands lost
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
Even more difficult to assess
“Replacement” costs
OR
“Opportunity” costs
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
Even more difficult to assess
“Replacement” costs
OR
“Opportunity” costs: cost of lost opportunities or
resources.
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
Value of ecosystem services
Even more difficult to assess
“Replacement” costs
OR
“Opportunity” costs: cost of lost opportunities or resources.
e.g. 260-570 million gallons of water lost to Tamarisk
transpiration in southern CA
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
“Existence” value : how to assess?
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
“Existence” value : how to assess?
‘Willingness to pay’ e.g. how much would you pay in tax to
preserve wilderness areas even if you didn’t visit them
for recreation?
“preservation” value: how much might it benefit you in future?
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
Discount rate: preference for having $$ now versus having the
same amount (adjusted for inflation) in the future
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
Discount rate: preference for having $$ now versus having the
same amount (adjusted for inflation) in the future
Typically set at the after-tax interest rate
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
Discount rate: preference for having $$ now versus having the
same amount (adjusted for inflation) in the future
Typically set at the after-tax interest rate
For industrialized countries, typically 1-4% (2-3%
commonly used in US)
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
Discount rate: preference for having $$ now versus having the
same amount (adjusted for inflation) in the future
Typically set at the after-tax interest rate
For industrialized countries, typically 1-4% (2-3%
commonly used in US)
For developing countries with rapid economic growth
and high rates of returns on investments, can be
up to 10%
4) Impacts
b) Economic
ii) Methodology
(1) Cost effectiveness (ex post) analyses – least cost method to
control
(2) Ex ante analyses – Cost-benefit analysis
3 major components of valuation
• Direct-use values: Consumptive & Non-consumptive
• Indirect-use values
• Non-use values
4) Impacts
b) Economic
Case study: Tamarix (saltcedar): Zavaleta 2002
• Relatively complete and detailed economic analysis
Incorporates direct-use & indirect-use (but not non-use) values
4) Impacts
b) Economic
Case study: Tamarix
• Introduced in mid-late 1800’s
• Originally encouraged and subsidized by governments for
windbreaks, erosion control & stream bank stabilization,
ornamentals
• Now widespread & dominant invader on much of the riparian
areas of western US
4) Impacts
b) Economic
Case study: Tamarix
• Introduced in mid-late 1800’s
• Originally encouraged and subsidized by governments for
windbreaks, erosion control & stream bank stabilization, ornamentals
• Now widespread & dominant invader on much of the riparian areas
of western US
• Because of widespread distribution and dominance, likely to
very expensive to eradicate
4) Impacts
b) Economic
Case study: Tamarix
• Introduced in mid-late 1800’s
• Originally encouraged and subsidized by governments for
windbreaks, erosion control & stream bank stabilization, ornamentals
• Now widespread & dominant invader on much of the riparian areas
of western US
• Because of widespread distribution and dominance, likely to
very expensive to eradicate
Will the economic benefits justify the costs?
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Economic analyses done by:
• Zavaleta (2000) Ambio 29:462-467
• Zavaleta (2000) in Mooney & Hobbs
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Economic analyses done by:
• Zavaleta (2000) Ambio 29:462-467
• Zavaleta (2000) in Mooney & Hobbs
Assumptions:
• Discount rate = 0% (overestimates the benefits)
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Economic analyses done by:
• Zavaleta (2000) Ambio 29:462-467
• Zavaleta (2000) in Mooney & Hobbs
Assumptions:
• Discount rate = 0% (overestimates the benefits)
• Costs are computed over a 20-year period to:
(1) Evaluate sites
(2) Eradicate Tamarix
(3) Revegetate and monitor effectiveness
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Economic analyses done by:
• Zavaleta (2000) Ambio 29:462-467
• Zavaleta (2000) in Mooney & Hobbs
Assumptions:
• Discount rate = 0% (overestimates the benefits)
• Costs are computed over a 20-year period to:
(1) Evaluate sites
(2) Eradicate Tamarix
(3) Revegetate and monitor effectiveness
• Benefits of removing Tamarix and restoring natives are
computed over a 55-year period
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #1 – aerial extent of Tamarix
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #1 – aerial extent of Tamarix. 2 estimates of acreage infested:
• Conservative estimate: Based on surveys and observed minimal
rates of spread – 1.16 million acres
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #1 – aerial extent of Tamarix. 2 estimates of acreage infested:
• Conservative estimate: Based on surveys and observed minimal
rates of spread – 1.16 million acres
• Bold estimate: Based on very detailed information for the Lower
Colorado River, extrapolated throughout the known distribution –
1.61 million acres
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
• Estimated water loss from Tamarix vs. natives
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
• Estimated water loss from Tamarix vs. natives
• All studies say Tamarix > natives, but the amount greater varies
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
• Estimated water loss from Tamarix vs. natives
• All studies say Tamarix > natives, but the amount greater varies
2 estimates:
(1) Mean of all studies: Tamarix uses 1.5 a.f. per year more than
native vegetation – Bold estimate
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
• Estimated water loss from Tamarix vs. natives
• All studies say Tamarix > natives, but the amount greater varies
2 estimates:
(1) Bold estimate: Tamarix uses 1.5 a.f. per year more
(2) Conservative estimate: 1.0 a.f. per year
4) Impacts
b) Economic
Case study: Tamarix – Will economic benefits justify costs?
Step #2 – Because Tamarix invades riparian areas, key to economic
damage in arid West is water
• Estimated water loss from Tamarix vs. natives
• All studies say Tamarix > natives, but the amount greater varies
2 estimates:
(1) Bold estimate: Tamarix uses 1.5 a.f. per year more
(2) Conservative estimate: 1.0 a.f. per year
• Then simple math to estimate annual greater water loss due to
Tamarix