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Economic Analysis of Invasive Species Policies 363
of market-based instruments (e.g. national taxes, import tariffs and tradable
permits) to directly address invasion-externalities. These instruments create
incentives for those trading in risky material to avoid the risk of invasions
and, therefore, the costs to the society which these may cause. They create signals
in the market so that private and society interests coincide and, therefore,
induce changes in the individual’s behaviour to reduce the likelihood of invasion.
Economic instruments should be combined with existing regulatory
measures (e.g. standards, inspections, quarantine, black/white lists, etc.) to
tackle the causes of invasions (Perrings et al. 2005). Therefore, economic studies
which further explore these policies in the context of invasive species are
required. Furthermore, other economic instruments to be investigated in the
future are graduated license fees, cost-sharing instruments, and environmental
bonds. The first capture the risk of invasion by applying more expensive
licences to more risky products. The second split up the responsibility
between the government and industry. Examples of this type of mechanism
include government compensations, lobbies, cost funding approaches, and
insurance. Currently, the possibility of insuring commercially against future
environmental effects is limited by the uncertainty surrounding the risk of
invasion and the expected high value of invasion damages.
Environmental bonds have been proposed for those industries where there
is a high level of uncertainty about the nature or severity of the damages
which they may cause (Costanza and Perrings 1990). The bond will be equal
to the best estimate of the potential future damages, and it would be returned
(plus some interests) when the firm could prove that the damages have not
occurred or would not occur. This system stimulates research on the consequence
of firms’ activities and technologies which reduce their environmental
impacts. At international level, Perrings et al. (2002, 2005) propose institutional
changes to support counter-invader measures in developing countries,
given that invasion policies in these countries (i.e. the weakest members of the
society) determine the level of protection against invasive species at a global
scale. The budget of developing countries in prevention efforts is limited or
non-existent (Mumford 2002). Therefore, international agreements are necessary
to guarantee the provision of rich countries’ resources for poor countries’
policies against IAS.
Responses to prevent the threat of invasions range from government agencies’
policies to multiple individual actions. This review shows that the potential
interactions between these responses need to be taken into account in the
development of counter-invader policies. In the 1980s, the interaction
between private agents and the regulator in the case of the invasion of the UK
by the western flower thrips (Frankliniella occidentalis), about which neither
group was well informed, illustrates the sometimes strained relationship
between regulators and regulated. To eradicate the new arrival, very high costs
were imposed (in the form of prescribed control and marketing restrictions)
upon a small number of private agents. It is therefore necessary to establish