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Effects of Invasive Species on Trade

Objective

truck hauling logs, photo by Chris Schnepf, University of Idaho, www.forestryimages.orgThis study, funded in 2003 by the Economic Research Service, is titled “Modeling the Effects of Invasive Species on the International Trade of Forest Products.” The study analyzes the economic effects of trade regulations aimed at preventing the importation of invasive species. The model is applied to the case of Siberian log imports into the U.S. To completely capture the production, consumption, trade and welfare effects of these regulations, the model considers two separate effects: (1) losses incurred by producers and consumers due to timber supply reductions caused by invasive species in the absence of regulations, and (2) the effects of technical regulations, such as phytosanitary rules and import bans, on producer and consumer welfare. The first aspect of the research involves estimation of the effects on U.S. timber supply of an invasive species. These effects are incorporated into the existing Global Forest Products Model (GFPM) to predict the consequent changes in U.S. international competitiveness. The second aspect of the research is the simulation with the GFPM of trade barriers or import bans imposed by the U.S. against potentially contaminated products. The results of this research will be useful to the U.S. government and the USDA Forest Service in designing economically effective trade policies to limit the threat of invasive species, and in understanding the impacts of such policies.

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Jeff Prestemon

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