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Real options analysis of Lake Ontario sterile sea lamprey transfers

The decision to use Lake Ontario sea lampreys in the St. Marys River  sterile male release program (SMR-SMRP) carries uncertainty and  potentially irreversible consequences of risk. Managers are  particularly concerned about the risk associated with inadvertent  pathogen translocation, and wish to use precautionary decision-making  approach. The presence of risk, however, should not necessarily  prevent the program as the program also generates benefits. Fishery  managers continue to face the challenge of appropriately incorporating  risk and uncertainty into management and would benefit from tools that  allow them to evaluate benefits, costs and risks in a structured way,  rather than relying on subjective criteria.  Real options analysis  (ROA) is an approach adapted from business and capital investment that  has the ability to address the issue of how much precaution is needed  in light of the risks inherent in the program. There are three  possible outcomes to a ROA: i) the benefits exceed the costs after  adjustment for risk and the project proceeds; ii) the benefits exceed  the costs if not adjusted for risk, but fail to exceed the costs when  adjusted for risk - in this case the project is delayed until  uncertainty can be reduced; or iii) the benefits fail to exceed the  cost even when not adjusted for risk, so that a loss is expected from  the project and the project is not undertaken. Traditional  precautionary approaches require arbitrary judgment to differentiate  type i from type ii outcomes. In contrast, ROA determines the amount  of precaution needed based on the risk characteristics of the project.  Here we propose to use ROA to determine if the risks associated with  sea lamprey transfers are small relative to the benefits (in which  case transfers should proceed), or if the risk is too great (so that  transfers should be delayed until uncertainty is reduced).  We will  focus particularly on risk related to accidental introduction of a  pathogen into the upper Great Lakes.    This analysis is relevant to SMR-SMRP decision-making and continued  use of Lake Ontario sea lampreys in the SMR-SMRP. The project will  demonstrate the application of ROA to fish movement problems, thereby  allowing managers and the GLFC to assess ROA's applicability to other  issues. 

In progress
Start Date
End Date
Jean TsaoPrincipal Investigator
Associated with 1 projects
Michael JonesResearcher
Associated with 3 projects
Eli FenichelResearcher
Associated with 1 projects
Graham HicklingResearcher
Associated with 1 projects
Great Lakes Fishery Commission $ 66,417.00USDActual

Funding 54 projects for a total of $5,089,137.00
Scope of Study
Literature / Existing Data
Resource Management
Lake Basin Connecting Channels
Lake Ontario
St. Marys River
State Province
Annex Numbers
Research & Development
Annex 17
Impact of water quality and AIS on fish and wildlife populations and habitats
  • Annex Numbers
    Annex Numbers
    Research & Development
  • Annex 17
    Annex 17
    Impact of water quality and AIS on fish and wildlife populations and habitats

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