Sören Höjgård

Antimicrobial sensitivity - a natural resource to be protected by a Pigouvian tax?

Since their discovery more than 70 years ago antibiotic drugs have been efficient tools for treating bacterial infections, and their use has reduced the number of fatalities and the suffering from bacterial diseases. However, the use of antibiotics may lead to resistance to the same or other antibiotics. The risk of resistance appears to be larger in veterinary medicine, since antibiotics have been given as feed-additives in animal production, the amounts given are larger, and the risk of selecting the wrong antibiotic is higher due to lack of diagnostic facilities. Historically, as resistance developed, new classes of antibiotics were developed, but today however, the flow of new substances has slowed. The resistance that arises from antibiotic use is a negative externality or a cost that is not included in the price of antibiotics since it affects the public good of antibiotic sensitivity. The negative externality implies that antibiotic consumption becomes too high. Antibiotic use can be restricted by e.g., prohibiting the use in animal feeding stuffs, prescription only use, or banning the use for animals or by using economic incentives, but restrictions on antibiotic use could have negative effects on the development of new antimicrobials since restrictions might reduce the profitability of such efforts to the pharmaceutical industry. It is therefore of interest to see what economic theory can contribute towards a solution. The objective of this study is to examine if a Pigouvian tax is an option for balancing the externalities and incentives for veterinary drug use. However, as a practical solution, it is suggested to use the costs of developing new antibiotics for determining the tax. The magnitude the tax based on European Union numbers ranges between 29 and 287euro per kilogram active substance or between 9 and 86% of the average price of commonly used antibiotics depending on the foreseen period in years (1-10 years) between the development of a new antibiotic drug. Hence, the sensitivity of bacteria to antibiotics should be managed as a finite natural resource. A tax based on the expected costs of development new antibiotic substances may offer a practical option for balancing the incentives and externalities of antibiotic use and development.

Preventing introduction of livestock associated MRSA in a pig population--benefits, costs, and knowledge gaps from the Swedish perspective.

Antibiotic resistance is a growing concern in human, as well as in veterinary medicine. Part of the problem concerns how to respond to the risk presented by animal reservoirs of resistant bacteria with the potential of spreading to humans. One example is livestock associated methicillin-resistant Staphylococcus aureus (LA-MRSA). In countries where LA-MRSA is endemic in the pig population, people in contact with pigs have a higher risk of being colonised with LA-MRSA, and persons from this group are subjected to precautionary measures when visiting health care facilities. In the present study, it is assumed that, if LA-MRSA was introduced to the Swedish pig population, the prevalence in the risk groups would be the same as in Denmark or the Netherlands (two countries with low human prevalence that have implemented measures to detect, trace and isolate human LA-MRSA cases and, therefore, have comprehensive data with good coverage regarding prevalence of LA-MRSA), and that similar interventions would be taken in Swedish health care facilities. It is also assumed that the Swedish pig population is free of MRSA or that the prevalence is very low. We analyse if it would be efficient for Sweden to prevent its introduction by testing imported live breeding pigs. Given that quarantining and testing at import will prevent introduction to the pig population, the study shows that the preventive measures may indeed generate a societal net benefit. Benefits are estimated to be between € 870 720 and € 1 233 511, and costs to € 211 129. Still, due to gaps in knowledge, the results should be confirmed when more information become available.

Willingness to pay for compulsory deworming of pets entering Sweden to prevent introduction of Echinoccoccus multilocularis

To investigate if the Swedish entry rules for pets to prevent the introduction of Echinococcus multilocularis (EM) are proportional (i.e. that their costs do not exceed the value of their benefits), a dichotomous-choice contingent valuation study was conducted. The study was performed before the first case of EM was detected in Sweden in February 2011. About 5000, randomly selected, Swedish citizens were invited to participate and 2192 of them (44%) accepted to do so. Missing information on whether or not one would accept to pay for keeping the rules for 143 respondents resulted in 2049 observations (41%) available for the estimation of willingness to pay (WTP), and missing information on personal characteristics for another 274 respondents reduced the number of observations available for sensitivity analysis to 1775 (36%). Annual expected WTP for keeping the rules ranged between € 54.3 and € 99.0 depending on assumptions about compensations demanded by respondents not willing to pay. The estimates are conservative since only answers from respondents that were absolutely certain they would pay the suggested bid were regarded as yes-responses. That WTP is positive implies that Swedish citizens perceived the benefits of the rules to be larger than their costs.

Earnings and Disposable Income of Farmers in Sweden, 1997-2012

This study presents a comprehensive analysis of farmers income in Sweden. The results indicate that farm households in Sweden do well from a standard-of-living perspective, but that farming is still a low-paid occupation from a return-on-skills perspective. Nevertheless, farm earnings increased faster over the study period than earnings in the general population, owing equally to higher farm earnings for operators and higher off-farm earnings for their spouse. Since few female spouses make farm earnings, evaluating farm household earnings from mainly a household perspective fails to acknowledge the individual careers of farmer and spouse.