Economic Perspectives on Wildfire — Preparation, Property and Health

Photo by Michael Held on Unsplash

The Council on Food, Agricultural, and Resource Economics (C-FARE) hosted a free webinar on November 16th, 2020 to discuss the increasing threat of wildfires within The United States. This event was hosted by C-FARE’s Sean Cash and moderated by AERE President-elect and Resources for the Future Senior Fellow, Karen Palmer. C-FARE joined forces with the Association of Environmental and Resource Economics (AERE) to host this discussion. 

C-FARE covered the topic of wildfires due to the threat of wildfires becoming an increasingly large challenge faced by many Americans. As of October 1, over 44,000 wildfires have burned nearly 7.7 million acres in the United States. This growing threat is in part due to increasing temperatures and changing weather conditions that are making the fires far more difficult to control and easier to spread.

Panelists Matthew Wibbenmeyer (Resources of The Future), Patty Champ (U.S. Forest Service/WiRE), and Eric Zou (University of Oregon) discussed their on-going research into wildfire mitigation practices and the impact of wildfire smoke pollution on human and economic capital.  

Matthew Wibbenmeyer (Resources of The Future) presented on issues related to the wildland-urban interface expanding and having increased development while wildfire risk continues to increase in these same areas. He highlighted that the households in these high-risk wildland-urban interface areas are disproportionately wealthy. This trend of expansion into high-risk areas shows no sign of stopping with a prediction of 600 thousand – 1.2 million new homes being built in the wildland-urban interface in California between 2000-2050.  

Although human suppression of fire limits economic and societal impacts of wildfire, recent studies found that decades of fire suppression promoted unnatural fuel accumulation with much higher stand density, which might be one of the reasons for the increased size of wildfires in U.S. during the last few decades. 

Wibbenmeyer was asked about his thoughts on whether or not the federal government should have a role in wildfire mitigation. He responded with, “Absolutely, the federal government has an important role to play here. Particularly, on the forest and land management side of this question. This is because 70% of the area burned in the Western United States in recent wildfires has been federal land. They could mitigate the risk to these lands in particular.” 

Patty Champ (U.S. Forest Service/WiRE) provided our attendees with an in-depth explanation of the WiRE approach to wildfire mitigation. The WiRE approach involves using systematic data collection and partnering with local wildfire risk mitigation organizations to adapt the wildfire mitigation approach to the individual locale and design specific programs for that area. The data is collected using rapid parcel assessment and household surveys.

Wildfires have the potential to effect agriculture negatively for reasons beyond the immediate risk of destruction. Short-term extreme temperatures may lead to large yield-reducing effects on major crops. In addition, increasing temperatures may shorten some important crop growth stages, such as the grain-filling stage, thus reducing crop yields. For some of these effects, a few minutes is all that is needed. 

To mitigate the risk of wildfire those involved in agriculture could engage in land-use changes, such as extensive livestock grazing, logging, and the conversion of natural vegetation to cropland aimed at reducing the fire number and size of the burn area. Euro-American settlements in the western U.S. reduced the frequency of fire in the late 19th and early 20th centuries with these methods.

Champ was asked about the role that insurance companies have regarding making individuals more likely to engage in wildfire mitigation activities. She responded with, “Our data suggests that insurance has not played a significant role in residents’ decisions to mitigate. However, we expect that may change over time. There are local wildfire education programs such as Boulder County Wildfire Partners (https://wildfirepartners.org/) that are working with insurance companies to assure that residents who are certified Wildfire Partners will not be denied insurance.”  

Eric Zou (University of Oregon) provided the audience with an estimation of the causal effect that wildfire smoke has on the elderly. He believes that wildfire smoke causes around 12,000 premature elderly deaths per year which accounts for $4.2 billion in mortality cost. He also points out that the health repercussions of a wildfire are not limited to that of the immediate area and recent studies have shown that smoke plumes can travel hundreds or thousands of miles. This means that a smoke plume can travel the distance between New York and Los Angeles potentially. 

Given that Zou’s work is focused on pollution prevention, he was asked whether he thought the EPA should have a role in wildfire mitigation because of the potential negative health effects to the general population. He responded with, “Wildfires are not regulated as an emission currently, so the EPA is not involved in that sense. Wildfire smoke would have to be incorporated as a source of emissions by the EPA first which would require a change in law for them to be able to regulate it.”

While the EPA may not currently regulate wildfire smoke pollution in the same way it would power plant emissions, they have recently worked on a citizen science project providing risk mitigation education on wildfires in the form of a mobile app. More information on this here: (https://www.epa.gov/air-research/smoke-sense-study-citizen-science-project-using-mobile-app)

This program is supported in part by the Agricultural and Applied Economics Association and the U.S. Department of Agriculture’s Economic Research Service and National Agricultural Statistics Service.

Those who register but cannot attend our webinar can always view a recording of it later at the council’s YouTube channel.