Benefit-cost analysis of spruce budworm ( Choristoneura fumiferana Clem.) control: Incorporating market and non-market values

This study employs a benefit-cost analysis framework to estimate market and non-market benefits and costs of controlling future spruce budworm ( Choristoneura fumiferana) outbreaks on Crown forest lands in New Brunswick, Canada. We used: (i) an advanced timber supply model to project potential timber volume saved, timber value benefits, and costs of pest control efforts; and (ii) a recent contingent valuation method analysis that evaluated non-market benefits (i.e., changes in recreation opportunities and existence values) of controlling future spruce budworm outbreaks in the Province. A total of six alternative scenarios were evaluated, including two uncontrolled future budworm outbreak severities (moderate vs. severe) and, for each severity, three control program levels (protecting 10%, 20%, or 40% of the susceptible Crown land forest area). The economic criteria used to evaluate each scenario included benefit-cost ratios and net present values. Under severe outbreak conditions, results indicated that the highest benefit-cost ratio (4.04) occurred when protecting 10% (284,000 ha) of the susceptible area, and the highest net present value ($111 M) occurred when protecting 20% (568,000 ha) of the susceptible area. Under moderate outbreak conditions, the highest benefit-cost ratio (3.24) and net present value ($58.7 M) occurred when protecting 10% (284,000 ha) of the susceptible area. Inclusion of non-market values generally increased the benefit-cost ratios and net present values of the control programs, and in some cases, led to higher levels of control being supported. Results of this study highlight the importance of including non-market values into the decision making process of forest pest management. ► We assess the benefits and costs of controlling spruce budworm outbreaks. ► A contingent valuation method and a wood supply model are used in the analysis. ► A number of outbreak severities and control program scenarios are considered. ► Net present values are highest when protecting 10–20% of the affected land base. ► Including non-market values can help justify larger control programs.