Economic principles for resource allocation decisions at national level to mitigate the effects of disease in farm animal populations

Abstract

SUMMARYThis paper originated in a project to develop a practical, generic tool for the economic evaluation of surveillance for farm animal diseases at national level by a state veterinary service. Fundamental to that process is integration of epidemiological and economic perspectives. Using a generalized example of epidemic disease, we show that an epidemic curve maps into its economic equivalent, a disease mitigation function, that traces the relationship between value losses avoided and mitigation resources expended. Crucially, elementary economic principles show that mitigation, defined as loss reduction achieved by surveillance and intervention, must be explicitly conceptualized as a three-variable process, and the relative contributions of surveillance and intervention resources investigated with regard to the substitution possibilities between them. Modelling the resultant mitigation surfaces for different diseases should become a standard approach to animal health policy analysis for economic efficiency, a contribution to the evolving agenda for animal health economics research.