| Stakeholders of the Taal Lake fish cage industry face the challenge of producing fish in a situation of frequent fish kill occurrences, which have been attributed to the deteriorating water quality due to nutrient pollution from fish cages. This study estimates the cost-effectiveness of nutrient pollution reduction options. Fifty operators were surveyed and the production data elicited were used in the estimation of a Cobb-Douglas production function. Results show that the types of ownership arrangements and institutional set-up in the municipalities of Agoncillo, Laurel, San Nicholas, and Talisay affect the production efficiency and nutrient loadings in the four cage locations. Marginal analysis reveals that operators are over-utilizing stocking density relative to feeding ration. At different percentage reductions in nutrient loadings, the cost-effectiveness of nutrient pollution reduction options differs among municipalities. With the current fish production technology and institutional set-up, nutrient pollution and decreasing biodiversity are inevitable. Developments in the institutional structures may lead to future technological changes in the fish production system and improvement of water quality in cage areas. |
