How Large is the Elephant in the Density Functional Theory Room?

A recent paper compares density functional theory results for atomization energies and dipole moments using a multi-wavelet based method with traditional Gaussian basis set results, and concludes that Gaussian basis sets are problematic for achieving high accuracy. We show that by a proper choice of Gaussian basis sets they are capable of achieving essentially the same accuracy as the multi-wavelet approach, and identify a couple of possible problems in the multi-wavelet calculations

Prices versus Quantities for Common Pool Resources

In Weitzman (1974) the choice between price and quantity regulation under imperfect information is analysed. It is shown that the choice between the two regulatory instruments depends on the sign of the sum of the curvatures of the cost and benefit functions. If the marginal benefit function is steep and the marginal cost function is flat quantity regulation is preferred over price regulation, while price regulation is preferred over quantity regulation if the marginal benefit function is flat and the marginal cost function is steep. The results in Weitzman (1974) are sometimes quoted in studies of fisheries management. In this paper an analysis of conditions for generalising the Weitzman result to fisheries economics is presented. It is shown that the result can be generalised if the cost function is additively separable in stock size and catches. This leads to the conclusion that the results hold for a schooling fishery. However, for a search fishery the condition that the cost function must be additively separable is seldom fulfilled and quotation of the classical article is therefore not reasonable. A further result is that for a schooling fishery, taxes are likely to be preferred over individual transferable quotas in the case where there is imperfect information about costs. The reason is that the marginal cost function is likely to be steeper than the demand function. In the light of this result, the fact that individual quotas regulate over 55 fisheries while taxes regulate none is surprising.Fisheries Management, Imperfect Information, Taxes, Individual Transferable Quotas

Fisheries Management with Multiple Market Failures

Within fisheries it is well-known that several market failures exist. However, fisheries economists analyse these market failures separately despite the fact that the market failures arise simultaneously. In this paper several market fail-ures that arise simultaneously are analysed. A resource stock tax and a tax on self-reported harvest are considered as a solution to problems associated with the stock externality, measuring individual catches and stock uncertainty. Within a fisheries economic model it is shown that it will be in the interest of risk-averse fishermen to report a part of their catch even without a control pol-icy. In addition, it is shown that this tax structure can secure optimal expected individual catches and simulations show that the tax payment is very low. Thus, the tax system may be useful in practical fisheries management.Prices regulation, Quantity regulation, Asymmetric Information, Self-Reporting, Stock Tax and Harvest Tax

Moral Hazard Problems in Fisheries Regulation: The Case og Illegal Landings

This paper treats illegal landings as a moral hazard problem that arises, since individual catches are unobservable to society and hence private information. A tax/subsidy mechanism taking into account the asymmetric information problem is formulated as a solution to problems with illegal landings. The incentive scheme uses fish stock size as the tax variable, and can be seen as an alternative to a control policy. Rough estimates from a simulation study suggest that the incentive scheme is potentially useful. The incentive scheme also has potential application as an instrument to the solution of by-catch and discard problems.

Regulation of Renewable Resources in Federal Systems: The Case of Fishery in th EU

The EU regulation of fisheries is decided in two levels. The level of the total allowable catch (TAC) for the most important species is decided every year by the Council of Minsters. The TACs are allocated to the Member States as quotas. The Member States determine who is going to harvest the quota. There is, however, an information problem associated with this structure. It does not take into account how efficient fishermen in different countries are. In this paper we model the information problem as an adverse selection problem and analyse an EU tax coupled to effort as an alternative to the TAC system. We work with the hypothesis that EU suffers from a fiscal illusion and includes tax revenue in the objective function in order to finance other, also inefficient, operations. Even in the light of these imperfections there are at least two reasons for recommending an EU tax. First, it can be used to correct part of the market failure associated with fishery. Second, it can be used to secure correct revealation of types in the light of asymmetric information.

The Regulation of Hunting: A Population Tax

Within hunting, wildlife populations are estimated to be too high in many countries which is assumed to be due to the market failure, that each hunter harvests too little compared to what the regulator wants. This may be due to the existing regulation which, among other things, requires knowledge of the individual harvest. However, information about the individual harvest may be costly to obtain. Thus, we may have to look for alternatives to the existing system. This paper proposes a population tax/subsidy as an alternative which is the difference between the actual and optimal population multiplied by an individual, variable tax rate. The variable tax rate is, among other things, based on the difference in marginal value of the population between the hunter and the regulator. The paper shows that the population tax/subsidy secures a first-best optimum. Thus, the population tax is a good alternative to the existing regulation.

A note on Marx

Throughout all his life Karl Marx wrote angrily about capitalism. By use of a dialectic approach he was convinced that the working class had to unite and make a social revolution and thereby free them selves from exploitation. Marx himself was in many ways a dialectic person as we try to show in the note. So in some sense he became one with his scientific methodology.

COULD WELFARE OPTIMALITY BE ACHIEVED WITH EXTENSIVE DATA INFORMATION?

This paper examines whether the Danish management system achieves welfare maximisation. For cod in the North Sea, Skagerrak, and Kattegat, rations are used. It is shown that rations raise substantial information requirements and that the existing allocation of rations is inoptimal. In addition, a linear programming model is used to show that there is considerable overcapacity in the Danish trawler fleet in the Baltic Sea. Danish fisheries managers have access to an extensive data set, and with the available information it would be possible to secure a welfare optimum.Resource /Energy Economics and Policy,