While the subset of introduced species that become invasive is small, the damages caused by that subset and the costs of controlling them can be substantial. This chapter takes an in-depth look at the economic damages non-native species cause, methods economists often use to measure those damages, and tools used to assess invasive species policies. Ecological damages are covered in other chapters of this book. To put the problem in perspective, Federal agencies reported spending more than half a billion dollars per year in 1999 and 2000 for activities related to invasive species ($513.9 million in 1999 and $631.5 million in 2000 (U.S. GAO 2000)). Approximately half of these expenses were spent on prevention. Several states also spend considerable resources on managing non-native species; for example, Florida spent $127.6 million on invasive species activities in 2000 (U.S. GAO 2000), and the Great Lakes states spend about $20 million each year to control sea lamprey (Petromyzon marinus) (Kinnunen 2015). Costs to government may not be the same as actual damages, which generally fall disproportionately on a few economic sectors and households. For example, the impact of the 2002 outbreak of West Nile virus exceeded $4 million in damages to the equine industries in Colorado and Nebraska alone (USDA APHIS 2003) and more than $20 million in public health damages in Louisiana (Zohrabian et al. 2004). Zebra mussels (Dreissena polymorpha) cause $300–$500 million annually in damages to power plants, water systems, and industrial water intakes in the Great Lakes region (Great Lakes Commission 2012) and are expected to cause $64 million annually in damages should they or quagga mussels (Dreissena bugensis) spread to the Columbia River basin (Warziniack et al. 2011).

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