Gains from quota trade: theoretical models and an application to the Danish fishery

Publikation: Bidrag til tidsskriftTidsskriftartikelfagfællebedømt

We provide a framework for evaluating potential effects of introducing tradable quotas to a sector. The effects depend on the economies of scale and scope of the production technology, and on firms' ability and willingness to learn best practice methods (catching up) and to change their input and output composition (mix). To illustrate our approach, data from the Danish fishery are used to calculate the potential gains from introducing individually transferable fishing quotas. Data envelopment analysis is used to model the production technology. We find that pure reallocation is as important as pure learning, i.e. quota reallocation without catching-up is as valuable as learning best practice with fixed allocations.
OriginalsprogEngelsk
TidsskriftEuropean Review of Agricultural Economics
Vol/bind34
Udgave nummer1
Sider (fra-til)105-127
Antal sider23
ISSN0165-1587
DOI
StatusUdgivet - 2007

ID: 8075856