|Hoagland, P. and S. Scatasta, The economic effects of harmful algal blooms, In E. Graneli and J. Turner, eds., Ecology of Harmful Algae. Ecology Studies Series. Dordrecht, The Netherlands: Springer-Verlag, Chap. 30, pp. 391-402, 2006|
We focus on how economists approach the problem of measuring the adverse effects of harmful algal blooms (HAB), as one type of natural hazard occurring in the coastal ocean. We start by drawing a distinction between scientific and economic approaches to assessments of the effects of HABs. We note that economists concern themselves with developing measures of changes in value (especially economic losses) as a consequence of HAB events. This interest is motivated primarily by society?s need to design responses to HABs that could mitigate economic losses at an appropriate scale. In other words, societal responses to HABs should be cost-minimizing, when all the relevant costs are considered. In this chapter, we focus on the costs of the adverse consequences of HAB events, not on the costs of societal responses. We address measures that are used to estimate changes in economic value, noting that some commonly used measures of ?economic effects? are not necessarily good measures of changes in economic value. We provide some examples of measures from both published and unpublished studies in the European Union and in the United States. We compare estimates of economic effects from both jurisdictions, finding such estimates roughly comparable for effects in public health, commercial fisheries, and monitoring and management. The economic effects of HABs on tourism apparently are much larger in the European Union, where these effects are the consequence of noxious but nontoxic blooms. We conclude with a call for increased attention to the development of estimates of changes in economic value from HABs, so that society?s resources can be directed to respond to these hazards more effectively.