Shadow costs of disease and its impact on output supply and input demand: the dual estimation approach

Ivar Vågsholm, Tim Carpenter, Richard E. Howitt

Research output: Contribution to journalArticle

3 Scopus citations

Abstract

An economic analytical model working with prices (the dual approach) was developed in which diseases were treated as fixed inputs. The dual approach was preferred to the primal approach (working with quantities) because of its ease of estimation with standard linear regression models. The impacts of disease on milk supply, demand for concentrates, and the shadow costs (lost profits) of a disease case were estimated to examine the impact of disease on milk production. The data were from 1913 dairy herds which participated in the Norwegian farm efficiency program during 1987. Reproductive diseases, ketosis, udder diseases and other diseases had shadow costs per case of 1751, 1268, 295 and 617 Nkr, respectively (1 US$ = 7 Nkr). Decreased incidence of reproductive diseases, ketosis and other diseases was associated with increased milk supply and increased demand for concentrates. Dual-approach models might be used in decision making on the industrial level with regard to disease control and for supply management.

Original languageEnglish (US)
Pages (from-to)195-212
Number of pages18
JournalPreventive Veterinary Medicine
Volume10
Issue number3
DOIs
StatePublished - Jan 1 1991

ASJC Scopus subject areas

  • Food Animals
  • Animal Science and Zoology

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