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The efficiency of the Environmental Management Charge in the Cairns management area of the Great Barrier Reef Marine Park

Author

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  • Farr, Marina
  • Stoeckl, Natalie
  • Beg, Rabiul Alam

Abstract

Using data from a survey of more than 1000 domestic visitors to the Northern section of the Great Barrier Reef (GBR) – predominantly those travelling on live-aboard dive boats – this research investigates the (tax) efficiency of the Environmental Management Charge (EMC). The travel cost method (with a zero truncated negative binomial specification) is used to estimate the price elasticity of demand, and those estimates are used to estimate the deadweight losses, the losses in visitor numbers that could be ‘blamed’ on the EMC and the associated taxation revenues for different types of trips. The welfare loss for each dollar of revenue raised from the EMC was estimated at less than one per cent for each type of trip considered. The analysis therefore suggests that, for these types of trips in this part of the reef at least, the EMC is a very efficient tax – particularly when compared with other taxes. This has important implications beyond the GBR, particularly in countries who struggle to find sufficient funds to properly manage world heritage areas: taxes such as these may be a relatively efficient and equitable means of collecting such revenues.

Suggested Citation

  • Farr, Marina & Stoeckl, Natalie & Beg, Rabiul Alam, 2011. "The efficiency of the Environmental Management Charge in the Cairns management area of the Great Barrier Reef Marine Park," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), pages 1-20, September.
    • Handle: RePEc:ags:aareaj:186960
    DOI: 10.22004/ag.econ.186960
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    Cited by:

    1. Farr, Marina & Stoeckl, Natalie, 2018. "Overoptimism and the undervaluation of ecosystem services: A case-study of recreational fishing in Townsville, adjacent to the Great Barrier Reef," Ecosystem Services, Elsevier, vol. 31(PC), pages 433-444.
    2. Pascoe, Sean & Doshi, Amar & Dell, Quentin & Tonks, Mark & Kenyon, Rob, 2014. "Economic value of recreational fishing in Moreton Bay and the potential impact of the marine park rezoning," Tourism Management, Elsevier, vol. 41(C), pages 53-63.
    3. Pascoe, Sean, 2019. "Recreational beach use values with multiple activities," Ecological Economics, Elsevier, vol. 160(C), pages 137-144.
    4. Doshi, Amar & Pascoe, Sean, 2013. "Investigating the effects of sample heterogeneity on the travel cost model for coral diving in Southeast Asia," 2013 Conference (57th), February 5-8, 2013, Sydney, Australia 152146, Australian Agricultural and Resource Economics Society.
    5. Pascoe, Sean & Doshi, Amar & Thébaud, Olivier & Thomas, Colette R. & Schuttenberg, Heidi Z. & Heron, Scott F. & Setiasih, Naneng & Tan, James C.H. & True, James & Wallmo, Kristy & Loper, Christy & Cal, 2014. "Estimating the potential impact of entry fees for marine parks on dive tourism in South East Asia," Marine Policy, Elsevier, vol. 47(C), pages 147-152.

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