Cost-benefit analysis of aquaculture expansion in Arctic Norway

Abstract

According to governmental plans, Norway faces huge expansions in the production of farmed Atlantic salmon. However, it is municipalities that designate coastal areas to aquaculture activities and their motivation depends on net benefits at municipal level from such use. Yet, there is little empirical evidence on costs and benefits of using coastal areas to aquaculture activities. We set up a cost-benefit analysis of salmon farming as seen from a municipal perspective. On the benefit side we count consumer and producer surplus of increased aquaculture production in the region, and the region's share of the national rent in aquaculture received as transfers from the national Aquaculture Fund. Costs are the opportunity cost of the land (sea) use, measured by households' willingness to pay to avoid aquaculture expansion, using data from a choice experiment. We find that parts of the producer surplus have to contribute to the regional economy for the NPV to be positive for a region.

Availability and usefulness of economic data on the effects of aquaculture: a North Atlantic comparative assessment

“…2017), others think they can be useful when carefully applied (Knowler 2008). One example of such a trade‐off analysis is Aanesen and Mikkelsen (2020), where there is a cost–benefit analysis of aquaculture expansions in a region, comparing direct and indirect economic impacts with the population’s willingness to pay to get/avoid the expansion.…”

“…While some authors point at controversies and challenges in the application of non-market valuation approaches (Plieninger et al 2013, Bas Vent ın et al 2015, Hanley et al 2015, Pascual et al 2017, others think they can be useful when carefully applied (Knowler 2008). One example of such a tradeoff analysis is Aanesen and Mikkelsen (2020), where there is a cost-benefit analysis of aquaculture expansions in a region, comparing direct and indirect economic impacts with the population's willingness to pay to get/avoid the expansion.…”

A Comparative Analysis of Technical Efficiency and Profitability of Agribusiness and Non-Agribusiness Enterprises in Eastern DRC

“…This study employed technical efficiency and profitability as competitiveness proxies to compare agribusiness and non-agribusiness competitivity, following [32,33,[45][46][47][48][49]. Regarding the technical efficiency analysis, we implemented a Data Envelopment Analysis (DEA), while the profitability analysis was based on two indicators, including the cost-benefit ratio and the net monthly revenue.…”

“…Given the foregoing, agribusiness will be less attractive to youth if it does not enable them to earn sufficient income as with comparable activities outside agribusiness, such as stores and magazines, hairdressers, restaurants and bistros, pharmacies, and sewing workshops [32][33][34]. Nevertheless, to our knowledge, the existing empirical literature is sparse when it comes to comparing agribusiness and non-agribusiness enterprises and ensuring that agribusiness is more competitive than non-agribusiness enterprises [15,32,33]. A recent study [22] showed that in addition to the success of youth engagement interventions in agribusiness, there is a lack of evidence on what works.…”

Pinnipeds and salmon farming: Threats, conflicts and challenges to co‐existence after 50 years of industrial growth and expansion

“…While climate change may have direct effects increasing the vulnerability of some species, it can also trigger the relocation of salmon farms, breeding sites and foraging areas. As salmon farming expands to higher latitudes in both hemispheres, 134,192 interactions with pinnipeds are expected to increase substantially and will probably affect new species, populations and communities in the years to come. The outcomes of such interactions will likely be modulated by the particularities of these new ecosystems, species and populations and the poorly assessed effects of climate change on both farmed salmonids and pinnipeds worldwide.…”