ABSTRACT
Biosecurity systems and the activities undertaken within them are public goods—no one can be excluded from accessing them or forced to pay for them. As a result, markets that would otherwise indicate the optimal amount of risk mitigation do not evolve naturally. Because of this market failure, governments across the globe intervene in the movement of goods and people, typically with science-based regulations that rarely account for stakeholder behaviours. Biosecurity regulations that do not carefully consider stakeholder responses can deliver unintended and counterproductive policy consequences, potentially undermining biosecurity outcomes. Potential solutions to generate the efficient level of biosecurity effort would be to modify the markets in which biosecurity effort and activities are determined or to create markets where they are missing. This chapter considers the missing biosecurity market problem and efficient solutions, including developing an “incentive-approach” to biosecurity. It also considers laboratory-based economic experiments to assess and refine policy changes before they are introduced into the economy and the role of technologies in the design and implementation of incentive-compatible policies.
