Full, self-contained replication package for "The Cost of Restricting Access to Natural Areas: African Swine Fever Containment Zones and Local Income"

the zipped file is a self-contained replication package for the paper "The Cost of Restricting Access to Natural Areas: African Swine Fever Containment Zones and Local Income". The execution requires locally installed recent versions of both Stata and R and the download of a package of external data from official websites of the Government of Italy. All steps are documented in the readme file and discussed in the paper. ABSTRACT The spread of African Swine Fever in the European Union since 2014 has triggered a policy response that, in several cases, included severe restrictions on access to forests and other natural areas. In most cases, pig farming and, to a lesser degree, the agricultural sector were compensated for the costs incurred as a consequence of the disease and its containment measures. The indirect costs borne by outdoor-based local economies, on the contrary, have been typically excluded from compensation schemes and, for the most part, remain unmeasured. This paper estimates these costs in the context of the African Swine Fever outbreak that affected North-West Italy from 2022 onward. Using municipal-level taxable income data and a difference-in-differences design, we estimate the effect of access restrictions on local income. We find a decline of self-employment income per taxpayer of about 18–23 percent relative to control municipalities. The effect is weaker and below statistical significance for small business income and absent for wage income and pension income. The result is also unaffected by pre-outbreak pig-farming intensity in the municipality, indicating that the impact of direct costs is negligible. These findings suggest that the portion of containment policies that restricted access to natural areas shifted a significant part of the economic burden of disease control on sectors unrelated to pig farming and on municipalities where pig farming has a very limited presence. They also raise a compensation-design issue: containment policies generate broad public benefits, but also appropriable benefits for pig producers outside the outbreak zone. In those circumstances, when indirect costs remain uncompensated and sector-specific benefits from containment measures are not internalized by the beneficiaries we should expect distorted incentives and sub-optimal policy responses. The paper discusses policy options to improve both the efficiency and fairness of compensation for disease-containment measures that restrict access to natural areas.