IDEAS home Printed from https://ideas.repec.org/a/spr/envpol/v25y2023i2d10.1007_s10018-022-00354-w.html
   My bibliography  Save this article

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
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10018-022-00354-w
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10018-022-00354-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Juutinen, Artti, 2008. "Old-growth boreal forests: Worth protecting for biodiversity?," Journal of Forest Economics, Elsevier, vol. 14(4), pages 242-267, November.
    2. Stefano DellaVigna, 2009. "Psychology and Economics: Evidence from the Field," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 315-372, June.
    3. Caparros, Alejandro & Jacquemont, Frederic, 2003. "Conflicts between biodiversity and carbon sequestration programs: economic and legal implications," Ecological Economics, Elsevier, vol. 46(1), pages 143-157, August.
    4. James L. Anderson & Frank Asche & Taryn Garlock, 2019. "Economics of Aquaculture Policy and Regulation," Annual Review of Resource Economics, Annual Reviews, vol. 11(1), pages 101-123, October.
    5. Nielsen, Rasmus, 2012. "Introducing individual transferable quotas on nitrogen in Danish fresh water aquaculture: Production and profitability gains," Ecological Economics, Elsevier, vol. 75(C), pages 83-90.
    6. Tahvonen, Olli, 1995. "Net national emissions, CO2 taxation and the role of forestry," Resource and Energy Economics, Elsevier, vol. 17(4), pages 307-315, December.
    7. Hean, Robyn L., 1994. "An Optimal Management Model For Intensive Aquaculture - An Application In Atlantic Salmon," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 38(1), pages 1-17, April.
    8. Mark A. Moore & Anthony E. Boardman & Aidan R. Vining & David L. Weimer & David H. Greenberg, 2004. "“Just give me a number!” Practical values for the social discount rate," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(4), pages 789-812.
    9. Eirik S. Amundsen & Trond Bjørndal, 1999. "Optimal Exploitation of a Biomass Confronted with the Threat of Collapse," Land Economics, University of Wisconsin Press, vol. 75(2), pages 185-202.
    10. G. Cornelis van Kooten & Clark S. Binkley & Gregg Delcourt, 1995. "Effect of Carbon Taxes and Subsidies on Optimal Forest Rotation Age and Supply of Carbon Services," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(2), pages 365-374.
    11. West, Thales A.P. & Wilson, Chris & Vrachioli, Maria & Grogan, Kelly A., 2019. "Carbon payments for extended rotations in forest plantations: Conflicting insights from a theoretical model," Ecological Economics, Elsevier, vol. 163(C), pages 70-76.
    12. Reed, William J., 1984. "The effects of the risk of fire on the optimal rotation of a forest," Journal of Environmental Economics and Management, Elsevier, vol. 11(2), pages 180-190, June.
    13. Larry Karp & Arye Sadeh & Wade L. Griffin, 1986. "Cycles in Agricultural Production: The Case of Aquaculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(3), pages 553-561.
    14. Asche, Frank & Roll, Kristin H. & Tveteras, Ragnar, 2009. "Economic inefficiency and environmental impact: An application to aquaculture production," Journal of Environmental Economics and Management, Elsevier, vol. 58(1), pages 93-105, July.
    15. Hoel, Michael & Kverndokk, Snorre, 1996. "Depletion of fossil fuels and the impacts of global warming," Resource and Energy Economics, Elsevier, vol. 18(2), pages 115-136, June.
    16. Rasmus Nielsen & Jesper Levring Andersen & Peter Bogetoft, 2014. "Dynamic Reallocation of Marketable Nitrogen Emission Permits in Danish Freshwater Aquaculture," Marine Resource Economics, University of Chicago Press, vol. 29(3), pages 219-239.
    17. Amundsen, E.S. & Bjorndal, T., 1999. "Optimal Exploitation of a Biomass Confronted with the Threat of Collapse," Norway; Department of Economics, University of Bergen 193, Department of Economics, University of Bergen.
    18. Hartman, Richard, 1976. "The Harvesting Decision When a Standing Forest Has Value," Economic Inquiry, Western Economic Association International, vol. 14(1), pages 52-58, March.
    19. Robyn L. Hean, 1994. "An Optimal Management Model For Intensive Aquaculture — An Application In Atlantic Salmon," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 38(1), pages 31-47, April.
    20. Price, Colin & Willis, Rob, 2011. "The multiple effects of carbon values on optimal rotation," Journal of Forest Economics, Elsevier, vol. 17(3), pages 298-306, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hoel, Michael & Holtsmark, Bjart & Holtsmark, Katinka, 2014. "Faustmann and the climate," Journal of Forest Economics, Elsevier, vol. 20(2), pages 192-210.
    2. Loisel, Patrice, 2020. "Under the risk of destructive event, are there differences between timber income based and carbon sequestration based silviculture?," Forest Policy and Economics, Elsevier, vol. 120(C).
    3. Macpherson, Morag F. & Kleczkowski, Adam & Healey, John R. & Hanley, Nick, 2017. "Payment for multiple forest benefits alters the effect of tree disease on optimal forest rotation length," Ecological Economics, Elsevier, vol. 134(C), pages 82-94.
    4. Yu, Zhihan & Ning, Zhuo & Chang, Wei-Yew & Chang, Sun Joseph & Yang, Hongqiang, 2023. "Optimal harvest decisions for the management of carbon sequestration forests under price uncertainty and risk preferences," Forest Policy and Economics, Elsevier, vol. 151(C).
    5. Susaeta, Andres & Chang, Sun Joseph & Carter, Douglas R. & Lal, Pankaj, 2014. "Economics of carbon sequestration under fluctuating economic environment, forest management and technological changes: An application to forest stands in the southern United States," Journal of Forest Economics, Elsevier, vol. 20(1), pages 47-64.
    6. Couture, Stéphane & Reynaud, Arnaud, 2011. "Forest management under fire risk when forest carbon sequestration has value," Ecological Economics, Elsevier, vol. 70(11), pages 2002-2011, September.
    7. Holtsmark, Bjart & Hoel, Michael & Holtsmark, Katinka, 2013. "Optimal harvest age considering multiple carbon pools – A comment," Journal of Forest Economics, Elsevier, vol. 19(1), pages 87-95.
    8. Eirik S. Amundsen & Frank Jensen, 2016. "Drought and Groundwater Management," IFRO Working Paper 2016/04, University of Copenhagen, Department of Food and Resource Economics.
    9. Eirik S. Amundsen & Frank Jensen, 2016. "Drought and Groundwater Management," CESifo Working Paper Series 5968, CESifo.
    10. Yu, Run & Leung, PingSun, 2009. "Optimal harvest time in continuous aquacultural production: The case of nonhomogeneous production cycles," International Journal of Production Economics, Elsevier, vol. 117(2), pages 267-270, February.
    11. Amundsen, Eirik Schrøder & Jensen, Frank, 2016. "Drought and groundwater management," Working Papers in Economics 05/16, University of Bergen, Department of Economics.
    12. West, Thales A.P. & Wilson, Chris & Vrachioli, Maria & Grogan, Kelly A., 2019. "Carbon payments for extended rotations in forest plantations: Conflicting insights from a theoretical model," Ecological Economics, Elsevier, vol. 163(C), pages 70-76.
    13. Morag F. Macpherson & Adam Kleczkowski & John Healey & Nick Hanley, 2015. "When to harvest? The effect of disease on optimal forest rotation," Discussion Papers in Environment and Development Economics 2015-19, University of St. Andrews, School of Geography and Sustainable Development.
    14. Newman, D.H., 2002. "Forestry's golden rule and the development of the optimal forest rotation literature," Journal of Forest Economics, Elsevier, vol. 8(1), pages 5-27.
    15. Yu, Run & Leung, PingSun, 2005. "Optimal harvesting strategies for a multi-cycle and multi-pond shrimp operation: A practical network model," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 68(4), pages 339-354.
    16. Barua, Sepul K. & Lintunen, Jussi & Uusivuori, Jussi & Kuuluvainen, Jari, 2014. "On the economics of tropical deforestation: Carbon credit markets and national policies," Forest Policy and Economics, Elsevier, vol. 47(C), pages 36-45.
    17. Luis Diaz-Balteiro & David Martell & Carlos Romero & Andrés Weintraub, 2014. "The optimal rotation of a flammable forest stand when both carbon sequestration and timber are valued: a multi-criteria approach," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 72(2), pages 375-387, June.
    18. Morag F. Macpherson & Adam Kleczkowski & John R. Healey & Nick Hanley, 2018. "The Effects of Disease on Optimal Forest Rotation: A Generalisable Analytical Framework," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 70(3), pages 565-588, July.
    19. Stainback, G. Andrew & Alavalapati, Janaki R.R., 2002. "Fire Risk and the Economics of Sequestering Carbon in Forests," 2002 Annual meeting, July 28-31, Long Beach, CA 19629, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Hu, Lijiao & Stainback, George & Li, Xiaoshu, 2016. "Economic Analysis of Carbon Sequestration under Risks in Forest management," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 229983, Southern Agricultural Economics Association.

    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

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:envpol:v:25:y:2023:i:2:d:10.1007_s10018-022-00354-w. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.