A Cost-Benefit Analysis of Pesticide Usage

Published by Irfan Bashir on

Pesticides, in their modern form and perception, are any substances or chemical compounds utilized in pest management of any kind. Until the agricultural revolution, pesticides took the form of natural sulfur compounds or smokes to fight mildew and blight, after which saw the use of industrial by-products (i.e. nitrophenols, petroleum oils, etc.) and select usage of inorganic substances such as sodium chlorate and sulphuric acid.

As agriculture expanded in the 19th century, larger unbroken fields and increased usage of chemical fertilizer allowed for the rapid growth of pests, leading to the usage of largely ineffective but colourfully marketed arsenical pesticides.

As health risks became apparent in the decades following, synthetic pesticide production accelerated, leading to the discovery of DDT in 1939, a synthetic organic. With the health risks of pesticide treatment unclear and the arrival of effective pesticides, the 1940s saw a “golden age” of pesticide production and utilization.

Soon thereafter, in 1962, the costs of indiscriminate pesticide usage became clear with the publication of Rachel Carson’s Silent Spring, which stimulated a national discussion about safer and more environmentally conscious pesticide usage.

Today, the discussion has evolved to include previously unforeseen costs and benefits of pesticide usage, including runoff, pesticide resistance, contamination, and the human health effects of toxic pesticides. In such a discussion, however, the benefits of pesticides must be kept in mind; the usage of pesticides brings several primary and secondary benefits such as increased production, reduced disease vectors, land intensification, and lowered costs of final goods. 

The most direct and perhaps valuable effect of pesticides is their effect on farm productivity. Simple agro ecosystems are far more susceptible to pest attacks than natural, complex ecosystems. Where crop protection is limited to just weed control, losses are estimated to be 50%, double that of certain treated crops. Pesticides offer an effective solution, without significant health or environmental effects, given their proper use (Popp). Agricultural productivity has increased in the past decades to meet increased population and living standards, and pesticides are in large part responsible for this increase in productivity. From 1965 to 1990, increased pesticide use directly increased worldwide yields from 45% of the theoretical maximum of no loss to 70% (Popp). Without pesticides and at present densities, 70% of crop yields today would be lost to pests, an unacceptable amount, given present populations. 

Pesticides efficacy scales well with increased usage. Pesticides give diminishing returns since as farms become denser due to pesticides, they become more vulnerable to pests, which in turn requires more pesticides. However, pesticides are still extremely effective. Specifically, since 1960, yields of wheat, maize, and other major sources of nutrition in America have doubled, mainly due to better crop protections. Yet this doubling in production by volume has seen only an average increase in loss to pests by 3.4%. (Popp). At almost any modern scale, pesticides are a viable way to increase productivity. Economically, the increased production due to pesticides vastly outweighs any costs incurred. Despite pesticides being responsible for near doubling crop yields, pesticides cost account only for 8% of farm production costs today (Popp). In general, $9.2 Billion is spent domestically on pesticides for a saving of around $60 billion worth of crops, equivalent to a return of 6.5 for every dollar spent (Atwood). 

“Most analyses of pesticide use on farms… have found a high marginal value product for pesticide expenditure relative to direct cost, suggesting that farmers are underutilizing pesticides (Mullen).” Given that globally, about 35% of crops overall, preharvest are still lost to pests (Popp), and given the relative cheapness of pesticides, pesticides remain an opportunity for productivity in most parts of the world. Pesticides decrease the environmental impacts of agriculture by reducing land use. Farming additional land is limited, as expansion occurs at the expense of forests, wildlife, and other natural resources. Rather, pesticides allow farmers to increase the productivity of existing land to meet demands.

For developing countries, one of the effects of pesticides is increasing land efficiency. For instance, in the Philippines from 1988 to 1991, during which the Phillippines was relatively agriculturally undeveloped, a 1.8% increase in pesticide use alone was associated with a 1% reduction in relative land use, although indirect human health impacts were observed (Antle 420). Introducing pesticides, even in established agricultural systems, reduces land use. The United States decreased farmland usage from 1964-1997 by 16% (U.S. Agricultural Census), with a near doubling of productivity, mostly due to improved crop protections. (Popp 248)

Substitution effects occur with the introduction of pesticides. Because pesticides allow farmers to grow more densely, pesticides incentivize farmers to substitute for denser, more land-productive crops. Produce-dense crops, such as apples, and potatoes receive nine times the dosage are substituted for less intensive crops such as maize and sunflower, for which the opposite was seen under France’s Ecophyto pesticide restrictions. (Urruty)

One of the many effects of pesticides includes improvement of public health, by reducing populations of disease vectors. For instance, malathion, an insecticide common in agriculture, protects crops by destroying potential disease-transmitting insects, such as lice or mosquitoes (“Malathion”). Sites with high mosquito activity, treated with malathion show significant drops in mortality, compared to those that had not (Charlwood). Another popular agricultural DDT, more potent and cost-effective than malathion saw popular use until 1972, (Miller, 67). Consequently, the following years saw a rise in malaria-related deaths in developing countries, presumably due to the lower availability of malaria-fighting DDT. 

The result of agricultural productivity, as a result of pesticides, is greater access to cheaper, cleaner, and more stable sources of food, while also reducing agricultural impacts on land. Furthermore, pesticides control possible disease vectors. For instance, according to the consumer price index, food is, on average and in real terms, less than half as costly as it was in 1970, while still being safer, and more accessible (Reed). Lowering the costs of producing food means consumers spend less on food, and more on other goods, overall increasing the welfare of everyone. Consumers worry less about their nutrition, the safety of their meals, or the cost of securing more food. In short, it’s easier, and cheaper to live healthy as a result of pesticides.

While such benefits provide at least a cause for justification, several secondary benefits, those in which cause and effect may be difficult to ascertain, may also provide strong justification for pesticide usage (Aktar, 1). Take, for example, that those increased revenues from higher yield may be directed to increased spending on education or health care. Beyond this, a higher level of biodiversity, or fitter people among other far-reaching impacts not easily quantified can add a not insignificant element to the conversation on pesticides.

The pesticide industry in agriculture is also a source of significant economic activity. Globally, pesticide expenditure totals over $55 billion. In the U.S. pesticides are distributed by about 25,000, produced by about 100 firms, and formulated by about 170 different firms (Pesticide Industry Sales Usage). Pesticides incur increased production of crops, decrease land use for agriculture, and have made food more available. Moreover, the pesticide industry creates many jobs both directly and indirectly. However, there are still costs of using pesticides. At the forefront, pesticides incur negative effects on human health and the environment, pesticide use has adverse effects on soil fertility, non-target organisms, pesticide resistance, surface and groundwater contamination, and soil cleanliness.

Primary concerns for the usage of pesticides in agriculture lie in public and human health effects. The World Health Organization (WHO) estimated globally one million human pesticide poisonings each year, with approximately 20,000 deaths in 1989 (Pimentel, 750). Today, these numbers have only increased with usage, with an estimated figure of three million cases of poisoning, leading to an estimated 200,000 deaths (Svensson, 6). However, this figure is difficult to measure with the general consensus of cases of pesticide poisoning amounting to 1-5 million. Furthermore, health costs are usually underestimated. “Health costs studies generally did not take into account fatal cases due to chronic exposure such as fatal outcomes of cancers. Doing so would have increased estimates of health costs by up to tenfold, e.g. from US$1.5 billion to US$15 billion in the United States in 2005.” (Denis Bourguet)

Although developed countries, including the US, annually use approximately 75-80% of all the pesticides produced in the world, less than half of the pesticide-induced deaths occur in these countries. A higher proportion of pesticide poisoning and deaths occur in developing countries due to inadequate safety standards, lack of education on the risks and associated hazards, improper storage, lack of protective clothing and washing facilities, among other factors.  Pesticides environmentally harm the land it treats, reducing the soil biodiversity, and obstructing the growth of future, possibly non-agricultural, ecosystems.

A 2002 study of pesticides by the AAAS conducted in Central Europe found that pesticides reduce soil fertility by killing non-target beneficial microorganisms in the soil. In plots of land where organic farming systems were used, there was a greater amount of microorganisms and earthworms than in conventionally managed soils. Soil pH was slightly higher in organic systems, with a lower abundance of phosphorus and potassium and a higher abundance of calcium and magnesium. Mycorrhizae, one of the microorganisms to contribute to more plant mineral nutrition, were found to colonize 40% more root length in the organic systems. Earthworm biomass was found to have increased by a factor of 1.3 to 3.2 (Maeder). A reduction of soil fertility imposes greater costs such as labor and financial costs on farmers, for instance by increasing the use of chemical fertilizer, which in turn incurs more environmental costs.

Pesticides are a major source of both surface and groundwater pollution. Traces of pesticides are commonly found in groundwater samples, with about 95% of streams, and over 50% of wells in the U.S. containing some trace of pesticides, with common pesticides being aldicarb, alachlor, and atrazine (Cornell, 2013). Because Pesticides, in toxic quantities, poses human health risks, and because one-half of the world obtains drinking water directly from wells or streams, pesticide contamination of water is of major ecological concern.

Monitoring and cleaning pesticide contamination further represent an economic cost. For instance, pesticide removal Rocky Mountain Arsenal, CO, cost around $2 Billion. Clearing pesticides from major water sources alone for consumption is estimated to cost over $500 million per year, while monitoring the public wells in the US, is estimated to cost $17.7 Billion per year. Furthermore, since groundwater contains few microbes to break down chemicals, and has a low replacement rate, pesticide contamination tends to build up over time. Pesticides represent an unsustainable source of pollution to water resources around the world (Pepijn).

Yet another concern of the usage of pesticides arises when one considers their long-term impact. Insecticide resistance is a fundamental threat to pest management and the goals of pesticide usage, with its roots in evolutionary biology. Such pesticide resistance costs have been estimated to be nearly $10 billion per year owing to additional pesticide applications and crop loss from resistant pests (Sexton, 292). Naturally, these resistances reduce the effectiveness of pesticides in preventing crop damage, thus diminishing output and prompting farmers to apply ever-increasing doses of chemical pesticides. Along with this apparent moral hazard, drawing on economic literature and analysis, we find that pest susceptibility appears to be a degradable and non-renewable resource that markets will fail to protect without appropriate intervention (Sexton, 293). 

With a relatively short time horizon of 10 years for resistances to take hold in an insect population, and the selection pressures (elimination of susceptible genes from the population) strengthened by high-dosage and continued pesticide application, the optimal response to resistance is a reduction in the use of chemicals, the exact opposite of the farmers’ individual profit optimization result. This short-sightedness on the part of the farmer can exacerbate the trend in ineffectiveness, as they may either overuse or underuse pesticides because they ignore both the future benefit of slowing pest population growth and the cost of resistance build-up. In total, the economic and health losses of pesticides add to several billion. “The major economic and environmental losses due to the application of pesticides in the USA were: public health, $1.1 billion year)1; pesticide resistance in pests, $1.5 billion; crop losses caused by pesticides, $1.4 billion; bird losses due to pesticides, $2.2 billion; and groundwater contamination, $2.0 billion.” (Pimentel, David)

Given the potential health hazards, and economic incentives of pesticides, pesticides are tightly regulated across countries, and impose secondary, regulatory costs. Regulatory costs of the industry alone reached up to $4 billion yearly in the United States in the 2000s. When evaluating costs, there are cases where it may be that costs are underestimated, overestimated, or impossible to correctly estimate within an approximation. For example, the long-term exposure of pesticides is difficult to estimate given various variables come into play when dealing with long-term exposure. As is the case with economics, conclusions often lead to more questions. Pesticides increase farm productivity, and in turn provide stable, easily accessible food, however at the expense of human and ecological health. 

There will always exist agencies both favoring and opposing the use of pesticides — both are necessary for a capitalistic society. So, can we say who is right and who is wrong? Would an average person in a developing country prefer (cheaper) food or more environment-friendly food? Reason tells us that they would prefer the option they can afford which in most cases is the cheaper option. Essentially, what we can say is if we want environment-friendly pesticides that cause less damage to soil, health, and biodiversity it will come at a cost — a cost someone has to pay. To mitigate any adverse effects of pesticide use, we need to conduct more research, fund more projects for better quality pesticides, and look into better alternatives — all this comes at a cost. Any solution to mitigate pesticide use means spending more resources dedicated to exploring better alternatives and improving the current products. Where pesticides lie in the future and how our relationship with them will change remains a debate.

Authored by Spencer Rockwell, Irfan Bashir, Jimmy Yang, and Jieming Zhang

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