The importance of fixed costs in animal health systems.

In this paper, the authors detail the structure and optimal management of health systems as influenced by the presence and level of fixed costs. Unlike variable costs, fixed costs cannot be altered, and are thus independent of the level of veterinary activity in the short run. Their importance is illustrated by using both single-period and multi-period models. It is shown that multi-stage veterinary decision-making can often be envisaged as a sequence of fixed-cost problems. In general, it becomes clear that, the higher the fixed costs, the greater the net benefit of veterinary activity must be, if such activity is to be economic. The authors also assess the extent to which it pays to reduce fixed costs and to try to compensate for this by increasing variable costs. Fixed costs have major implications for the industrial structure of the animal health products industry and for the structure of the private veterinary services industry. In the former, they favour market concentration and specialisation in the supply of products. In the latter, they foster increased specialisation. While cooperation by individual farmers may help to reduce their individual fixed costs, the organisational difficulties and costs involved in achieving this cooperation can be formidable. In such cases, the only solution is government provision of veterinary services. Moreover, international cooperation may be called for. Fixed costs also influence the nature of the provision of veterinary education.

Les auteurs de cet article décrivent en détail la structure et la gestion optimale des systèmes de santé, telles que les influencent l'existence et le volume des coûts fixes. Contrairement aux coûts variables, les coûts fixes ne sont pas modulables et sont donc indépendants du volume d'activité du secteur vétérinaire à court terme. Leur importance est illustrée par l'utilisation simultanée de modèles couvrant une période unique et de modèles multi-périodiques. Il est démontré qu'en santé animale, le processus décisionnel par étapes peut souvent être envisagé comme une séquence de problèmes liés aux coûts fixes. En général, il apparaît clairement que plus les coûts fixes sont élevés, plus grand doit être le bénéfice net dégagé par les prestations vétérinaires, si l'on veut que celles-ci soient rentables. Les auteurs évaluent également l'intérêt éventuel de réduire les coûts fixes en essayant de compenser cette baisse par une augmentation des coûts variables. Les coûts fixes ont des répercussions structurelles majeures sur l'activité du secteur des produits de santé animale ainsi que sur les prestations vétérinaires du secteur privé. Dans le secteur des produits de santé animale, les coûts fixes favorisent la concentration des marchés et la spécialisation de l'offre. Dans le secteur de l'exercice vétérinaire privé, ils incitent à une spécialisation accrue. Si la coopération individuelle des éleveurs peut contribuer à réduire leurs charges fixes à l'échelle individuelle, les contraintes organisationnelles et les coûts induits par une telle coopération peuvent s'avérer redoutables. Dans de telles configurations, la seule solution consiste à confier la prestation des services vétérinaires au secteur public. Il peut aussi être fait appel à la coopération internationale. Les coûts fixes influencent également la nature de l'offre de formation en médecine vétérinaire.

Los autores exponen en detalle la estructura y la gestión óptima de los sistemas sanitarios en aquellos aspectos que se ven influidos por la presencia de costos fijos y por su cuantía. A diferencia de los costos variables, los fijos no pueden ser modificados y por lo tanto son, a corto plazo, independientes del nivel de actividad veterinaria. El uso de modelos relativos a un periodo único y a periodos múltiples pone de manifiesto la importancia que revisten los costos fijos. Los autores explican que el proceso de adopción de decisiones veterinarias, que discurre en varias etapas, puede ser entendido a menudo como una secuencia de problemas ligados a los costos fijos. En general queda claro que, cuanto más elevados sean los costos fijos de la actividad veterinaria, mayor beneficio neto debe deparar esta para ser rentable. Los autores también valoran en qué medida resulta rentable disminuir los costos fijos y tratar de compensar esta reducción con un aumento de los costos variables. Los costos fijos influyen sobremanera en la estructura de actividad económica del sector de los productos de sanidad animal y en la estructura de la prestación privada de servicios veterinarios. En el primer caso, favorecen la concentración del mercado y la especialización en el suministro de determinados productos. En el segundo, potencian un mayor grado de especialización. Aunque la cooperación entre los ganaderos puede ayudar a reducir sus costos fijos individuales, este tipo de cooperación entraña enormes dificultades y costos organizativos. En tales casos, la única solución reside en la prestación de servicios veterinarios desde instancias oficiales. Por otro lado, también cabe recurrir a la cooperación internacional. Los costos fijos influyen asimismo en el tipo de enseñanza de la veterinaria que se imparte.

The economic impacts of endemic diseases and disease control programmes.

The authors discuss the evaluation of the economic impacts of endemic livestock diseases, and economic issues in control of these diseases. Particular attention is focused on helminths and on endemic vector-transmitted infections (particularly ticks and tick-borne diseases). Decisions relating to disease control have to be made by government and by the producer. Government requires information on the level of control to adopt, the extent of involvement needed, and how to fund animal health programmes (particularly how to share costs between taxpayers and livestock producers). Individual producers require information as to how much effort to invest in disease control, including information collection effort, and how to design control strategies. Economics can shed light on these issues. However, experience suggests that animal health policies are particularly difficult to evaluate from an economic viewpoint, with complex relationships between animal health, production impacts, market access, and non-production benefits of livestock. While little information is available concerning the cost of helminth diseases, many estimates have been made of the costs of ticks and tick-borne diseases at a regional and national level, sometimes demonstrating that eradication is warranted.

The developmental implications of migration from and between small island nations.

PIP: This article discusses the role of migration in relieving population pressures, thus making continuing development possible, using small nations in the Caribbean and the South Pacific as examples. The Caribbean islands and many Pacific islands have used out-migration to ease population pressures in this century. Surplus labor has been emerging in various Caribbean nations, independent of the international marketing problems of plantation agriculture. Rural populations alienated from plantations have had to make do on questionable and/or remote land. Population surpluses appear to originate in rural areas, but little evidence exists to suggest that those surpluses are the basis for the emigration patterns of the Caribbean islands. Emigration does not solve population problems because when ambitious, skilled workers leave their country, their actions have little to do with the existence of domestic surplus labor and their leaving may do little to facilitate domestic labor absorption. Thus, if mini-states wish to sustain their hopes of economic expansion, they must find the means to employ their surplus labor. Since mainly skilled migrants leave, their going may actually slow development and retard opportunities for labor absorption. Population movements internal to the Caribbean region may further complicate surplus labor and/or population problems. If protective entry requirements impede normal inter-island relations, they may interfere with developmental processes. In general, migration is not a feasible strategy for population control for small island nations. While temporary migration has a more positive impact than other forms of migration, problems do exist. For example, temporary migration 1) can impose significant economic costs on the source-country, and 2) may result in the source country being unable to capitalize on its initial investment in training and education of temporary migrants. In conclusion, import substitution through cooperation between small island nations, production for export where feasible, and more attention to more sophisticated international service linkages hold a better prospect for material progress than relying on the export of surplus populations.^ieng