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Regulation of aquaculture production

Author

Listed:
  • Frank Jensen

    (University of Copenhagen)

  • Rasmus Nielsen

    (University of Copenhagen)

  • Henrik Meilby

    (University of Copenhagen)

Abstract

In this paper, we investigate the economically optimal regulation of aquaculture production. The time between releasing and harvesting fish (rotation time) from a pond is an important decision variable for an aquaculture producer, and we use rotation time as a regulatory variable. By using a general model as a starting point, we construct a basic model for a private and social optimum assuming an infinite time horizon. The quality of fish is explicitly included in our basic model, and we show that a total tax scheme, collected at the end of each rotation, equal to the total discounted damage costs secures a social optimum. We also discuss the implications of several modeling extensions for our regulatory recommendations, but we require that the extensions can be captured within the general model. Examples of modeling extensions include differences between socially and privately fixed costs and discount rates.

Suggested Citation

  • Frank Jensen & Rasmus Nielsen & Henrik Meilby, 2023. "Regulation of aquaculture production," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 25(2), pages 161-204, April.
    • Handle: RePEc:spr:envpol:v:25:y:2023:i:2:d:10.1007_s10018-022-00354-w
    DOI: 10.1007/s10018-022-00354-w
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    Cited by:

    1. Oglend, Atle & Asche, Frank & Straume, Hans-Martin, 2024. "Rent formation and distortions due to quotas in biological production processes," Resource and Energy Economics, Elsevier, vol. 77(C).

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    More about this item

    Keywords

    Aquaculture; Optimal regulation; Rotation time; Pigovian tax;
    All these keywords.

    JEL classification:

    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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