An approach for evaluating the economic impacts of harmful algal blooms: The effects of blooms of toxic Dinophysis spp. on the productivity of Scottish shellfish farms

Shellfish production is an important activity for the economy of many countries. As well as its direct value, it helps to stabilize communities in rural areas characterized by limited job opportunities. It is also important for consumers who recognize shellfish as a healthy product that gains its nutrition from natural plankton without the need for fertilizers, chemical treatments or other anthropogenic intervention typical of terrestrial agriculture or other marine aquaculture. Nevertheless, global shellfish fisheries are under threat from harmful algal blooms (HABs) and related biotoxins, whose production is potentially exacerbated by global changes. This research provides evidence of economic impacts on Scottish shellfish farms in the last 10 years caused by HABs and their associated biotoxins. In contrast to previous approaches that have focused on variation in production as a function of temporal trends and blooms events, we use a production function approach to show which input factors (labour, capital, climate variables, concentration of biotoxins) have an effect on production. Results show that diarrhoetic shellfish toxins produced by the genera Dinophysis are most significant. A 1% change in the production of these biotoxins reduces shellfish production by 0.66%, with an average yearly negative variation in production of 15% (1,080 ton) and an economic loss (turnover) of £ (GBP) 1.37 m per year (in 2015 currency) over a national annual industry turnover of ~ £ 12 m. The production function approach is coupled with a multivariate time series model (VAR) capturing the statistical relationship between algal concentration, information on climatic variables and biotoxins to forecast the damage to shellfish production from HABs. This provides producers and regulators with the economic information to plan temporal and spatial mitigating measures necessary to limit damages to production by comparing the costs of these measures with the costs of lost production.