1 A Welfare Gain from Switching to Taxes? The Danish Cod Fishery in the Kattegat Frank Jensen Associate professor, Department of Food and Resource Economics, University of Copenhagen, Frederiksberg C.; fje@ifro.ku.dk Lars Gårn Hansen Professor, Department of Food and Resource Economics, University of Copenhagen, Frederiksberg C.; lgh@ifro.ku.dk Rasmus Nielsen Associate professor, Department of Food and Resource Economics, University of Copenhagen, Frederiksberg C.; rn@ifro.ku.dk ABSTRACT Theoretical papers show that there could be a welfare gain from switching to tax regulation if managers are more uncertain about key parameters of a fishery than fishermen. We estimate the size of the welfare gain that would result if a manager of the Danish cod fishery in the Kattegat switched from the current individual transferable quota system to tax regulation. We find that this would generate a small welfare gain of 0.023% of the industry profit and variations in parameter values (+/- 20 %) at most result in a gain of 0.029% (JEL Q22, C54, D62, H23, Q28) doi:10.3368/le.100.2.052521-0054R2 by guest on July 23, 2024. Copyright 2023 Downloaded from