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Economic Analysis of Cost Recovery and Rental Collection

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  • In several countries, cost recovery and/or rent collection (CRRC) has become integral to fishery management. This paper will examine CRRC from three perspectives: neo-classical economic efficiency, equity, and public choice. Partial equilibrium economic efficiency arguments include incentives for industry to implement (or lobby for) efficient delivery of management services. On the resource rent side, there is the static Henry George argument that taxes on pure resource rentals have no efficiency effect. There is also the Harberger general equilibrium argument that the decision to tax or not to tax may distort resource allocation across sectors. The public choice analysis embeds the efficiency and equity issues within the context of rent-seeking through and within government decision-making. For example, public choice analysis would suggest that CRRC may be a form of public agency rentseeking. CRRC may act as a dedicated tax, with its concomitant incentives for agencies. These multiple perspectives suggest that the economic verdict on CRRC is very complicated.
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  • Townsend, Ralph. 2008. Economic Analysis of Cost Recovery and Rental Collection. In: Proceedings of the Fourteenth Biennial Conference of the International Institute of Fisheries Economics & Trade, July 22-25, 2008, Nha Trang, Vietnam: Achieving a Sustainable Future: Managing Aquaculture, Fishing, Trade and Development. Compiled by Ann L. Shriver. International Institute of Fisheries Economics & Trade, Corvallis, Oregon, USA, 2008.
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  • US National Oceanic and Atmospheric Administration (NOAA) Fisheries Division, The Department of Fisheries and Oceans, Canada; Aquaculture CRSP and AquaFish CRSP; Minh Phu Seafood Corporation; Vietnam Datacommunication Company (VDC); Camau Frozen Seafood Processing Import Export Corporation (Camimex); Long Sinh Limited Company; Mai Linh Group and Nam Viet Corporation.
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