Dynamic Reallocation of Marketable Nitrogen Emission Permits in Danish Freshwater Aquaculture

Rasmus Nielsen, Jesper Levring Andersen, Peter Bogetoft

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

The potential gains from a regulatory change allowing for reallocation of marketable nitrogen emission permits under a cap and trade system are analyzed in a dynamic context using Data Envelopment Analysis to formulate linear programming models. In these models new, more environmental friendly farms are gradually introduced to the industry over 10 years. The new industry structure, production, and profitability gains are investigated, and the effect of changing the overall level of nitrogen emission is analyzed. Our results show that there is scope for a more efficient allocation of resources to either increase the production level or to reduce the emission level. This article adds to the literature by extending previous static reallocation models to a dynamic model, which allows for a gradual introduction of new firms. This makes it possible for managers to analyze the effects of reallocating production across firms and time.
Original languageEnglish
JournalMarine Resource Economics
Volume29
Issue number3
Pages (from-to)219-239
ISSN0738-1360
Publication statusPublished - 2014

Bibliographical note

CBS Library does not have access to the material

Cite this

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title = "Dynamic Reallocation of Marketable Nitrogen Emission Permits in Danish Freshwater Aquaculture",
abstract = "The potential gains from a regulatory change allowing for reallocation of marketable nitrogen emission permits under a cap and trade system are analyzed in a dynamic context using Data Envelopment Analysis to formulate linear programming models. In these models new, more environmental friendly farms are gradually introduced to the industry over 10 years. The new industry structure, production, and profitability gains are investigated, and the effect of changing the overall level of nitrogen emission is analyzed. Our results show that there is scope for a more efficient allocation of resources to either increase the production level or to reduce the emission level. This article adds to the literature by extending previous static reallocation models to a dynamic model, which allows for a gradual introduction of new firms. This makes it possible for managers to analyze the effects of reallocating production across firms and time.",
keywords = "Dynamic reallocation, Marketable nitrogen emission permits, Data development analysis, Aquaculture",
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Dynamic Reallocation of Marketable Nitrogen Emission Permits in Danish Freshwater Aquaculture. / Nielsen, Rasmus; Levring Andersen, Jesper; Bogetoft, Peter.

In: Marine Resource Economics, Vol. 29, No. 3, 2014, p. 219-239.

Research output: Contribution to journalJournal articleResearchpeer-review

TY - JOUR

T1 - Dynamic Reallocation of Marketable Nitrogen Emission Permits in Danish Freshwater Aquaculture

AU - Nielsen, Rasmus

AU - Levring Andersen, Jesper

AU - Bogetoft, Peter

N1 - CBS Library does not have access to the material

PY - 2014

Y1 - 2014

N2 - The potential gains from a regulatory change allowing for reallocation of marketable nitrogen emission permits under a cap and trade system are analyzed in a dynamic context using Data Envelopment Analysis to formulate linear programming models. In these models new, more environmental friendly farms are gradually introduced to the industry over 10 years. The new industry structure, production, and profitability gains are investigated, and the effect of changing the overall level of nitrogen emission is analyzed. Our results show that there is scope for a more efficient allocation of resources to either increase the production level or to reduce the emission level. This article adds to the literature by extending previous static reallocation models to a dynamic model, which allows for a gradual introduction of new firms. This makes it possible for managers to analyze the effects of reallocating production across firms and time.

AB - The potential gains from a regulatory change allowing for reallocation of marketable nitrogen emission permits under a cap and trade system are analyzed in a dynamic context using Data Envelopment Analysis to formulate linear programming models. In these models new, more environmental friendly farms are gradually introduced to the industry over 10 years. The new industry structure, production, and profitability gains are investigated, and the effect of changing the overall level of nitrogen emission is analyzed. Our results show that there is scope for a more efficient allocation of resources to either increase the production level or to reduce the emission level. This article adds to the literature by extending previous static reallocation models to a dynamic model, which allows for a gradual introduction of new firms. This makes it possible for managers to analyze the effects of reallocating production across firms and time.

KW - Dynamic reallocation

KW - Marketable nitrogen emission permits

KW - Data development analysis

KW - Aquaculture

M3 - Journal article

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SP - 219

EP - 239

JO - Marine Resource Economics

JF - Marine Resource Economics

SN - 0738-1360

IS - 3

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