While the sight of fuzzy, yellow winged critters may strike fear into the hearts of the sting-adverse, bees are surprisingly essential to life as we know it. Without bees to take on the herculean task of pollinating the plants of this world, it is estimated that mankind would only survive four years before going extinct. Humanity’s oft-forgotten dependence on bees makes Colony Collapse Disorder (CCD), an increasingly prevalent phenomenon in which bee colonies abruptly die without a definite traceable cause, quite an ominous occurrence. While environmentalists have been preoccupied with the mysterious mass deaths of our trusty pollinators for some time now, bees rarely enter discussions in economic circles. The collapse of bee colonies is, however, an important economic problem as the world’s capacity to respond to this issue and the impacts on agricultural market systems are all fundamentally economic issues.
The economic value of bees is derived from their labor and product –the act of pollinating and the subsequent growth of food. In 2007, the National Audit Office in the United Kingdom estimated the value of honeybees in their economy as a whole.[1] To the surprise of many, the value of honeybee “labor” was estimated to be £200 million a year, or about $317 million. To put this in perspective, replacing the bee’s labor would involve paying minimum wage to an adequate number of workers to brush pollen onto the insides of all the necessary plants, a process that is already underway in areas of China where bees are extinct. Perhaps more dramatically, the retail value of the product that the Chinese pollinate is estimated at over £1 billion, or about $1.6 billion. Not only would losing bees mean missing out on many of the diverse, delicious crops that consumers enjoy throughout the year, but also it would certainly devastate agricultural producers in suffering areas. Moreover, the disappearance of bees would shift the trade equilibrium. Colony collapse disorder affects mostly North America and Europe, so unless these regions can find a way to curtail declining domestic bee populations, both North America and Europe would have to rely more heavily on foreign agricultural products.
Commercial beekeeping should be on the rise in response to the rapidly rising demand for bee services, but instead the natural volatility of the beekeeping industry has left many commercial beekeepers in dire straits. Though a single beehive can be worth about $200 depending on the season, the cost to maintain colonies has doubled in the past two decades, as the number of colonies has fallen by one-fourth and the number of beekeepers by half.[2] The profitability of starting a commercial beekeeping business takes a beating from environmental factors, which are further compounded as the incidence of CCD increases.[3] When science struggles to pin down an understanding of an environmental phenomenon, classic market understandings are at the mercy of nature’s mysteries.
Despite the pressing nature of Colony Collapse Disorder, the research on its causes, and more importantly, its solutions are woefully incomplete. Scientists have determined a few possible causes of Colony Collapse Disorder, ranging from pesticides and GMOs to suburban sprawl. The future of the bees and the economic processes they control will need to be weighed against the value of their destabilizers; furthermore, savvy economists would be wise to pay attention to fluctuating bee population as time progresses.
[1] http://news.bbc.co.uk/2/hi/business/8015136.stm
[2] http://gizmodo.com/commercial-beekeeping-and-the-rise-of-bee-thieves-1570529274
[3] http://beespotter.mste.illinois.edu/topics/economics/
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