Beyond the Threshold: Costly Information and the Implementation of Integrated Pest Management

Hyewon Lee and David A. Hennessy

No 404683, 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association

Abstract: Integrated Pest Management (IPM) recommends scouting fields and spraying only when expected damage exceeds the cost of control. Yet threshold-based recommendations are unevenly implemented in practice. This paper argues that the key friction is not only whether farmers accept threshold rules, but whether they have private incentives to acquire the information needed to use them. We study this problem in the context of soybean aphid management in the U.S. Midwest. Spray rates respond only weakly to realized pest pressure, farmer-level management rules are persistent and heterogeneous, and many growers rely on prophylactic seed treatments that bypass early-season scouting. We develop a model in which farmers hold prior beliefs about latent short-run aphid growth, choose whether to acquire information through scouting, update beliefs, and then decide whether to spray. The model separates the treatment margin from the information margin and shows that information can be decision-relevant without being privately acquired. Calibrating the model with pesticide use, aphid population, and cost data, we find that empirically relevant aphid densities often fall within a range where scouting could affect treatment decisions, yet the private value of information remains small. Atthebenchmark density, the gross value of scouting is approximately $0.125 per acre, compared with an observed scouting cost of $4.61 per acre. Under benchmark costs, the privately optimal scouting set is empty. The results suggest that the central implementation friction in threshold-based IPM is the private economics of monitoring rather than the placement of the threshold itself. Policies and technologies that lower monitoring costs and improve information quality target the relevant margin.

Keywords: Production; Economics (search for similar items in EconPapers)
Pages: 38
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea26:404683

DOI: 10.22004/ag.econ.404683

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