Economic Welfare Impacts of Foot‐and‐Mouth Disease in the Canadian Beef Cattle Sector

Abstract

A foot‐and‐mouth disease outbreak, although having a low probability of occurrence, results in losses of export markets and introduces considerable potential disease management and eradication costs. We develop a dynamic model that integrates beef cattle production, disease dissemination, domestic consumption, and international trade and captures the intertemporal economic welfare impacts of mitigation measures. The model is applied to the case of a hypothetical outbreak in Canada to capture changes in producer profits, consumer price, and government costs due to the outbreak and sums these to measure changes in total economic welfare of the beef industry. Mitigation scenarios are reported for stamping‐out, movement controls, vaccination, and preemptive slaughter.