Role of Perception in Environmental Decision-making: A Study on Shrimp Farming in Bangladesh

Abstract

Though shrimp farming has pioneered the socioeconomic development of southwestern Bangladesh, farmers often ignore environmental aspects in farm-level decision-making. To maximize profitability, they are reluctant to account for the environmental impact of shrimp farming. Eco-farming method has gained global attention and encompasses a range of principles and practices that benefit both the environment and the farmers. The study designs the Risk-Response-Recovery (3R) framework to choke off the intricacies, associated with the implementation of eco-farming methods in developing countries like Bangladesh. Therefore, the study explores the role of perceptions in environmental decision-making in shrimp farming and surveys 210 shrimp farmers through a systematic random sampling technique from the Khulna and Bagerhat districts. Technical efficiency is calculated with the help of the stochastic frontier production function. Besides, the study weighs perceptions regarding environmental decision-making such as waste-water management, lime, chemicals, safe fish, feed, and farm management via Principal Component Analysis (PCA). Successively, these perceptions are then used in the Tobit regression model to evaluate their impact on technical efficiency. The profitability equation infers economic prospects of shrimp farming with an estimated Benefit-Cost Ratio (BCR) of 1.97. Eco-farming method adopters are able to produce 35 percent higher output compared to their counterparts with a given resource. However, the adoption of eco-farming methods is impeded by a lack of knowledge and information and uncertainty regarding short-term profitability loss. Gher size and fingerlings show complementary influence on the productivity of shrimp farming. The perceptions of feed management and safe fish production come out as significant determinants of technical efficiency. Therefore, the study recommends reform in the implementation of eco-farming method embodying the assumptions of the 3R model and establishing a farmer-centric tailored extension service to promote safe fish farming practices. Furthermore, this study is a benchmark in determining environmental decision-making and encourages additional explication on this dimension of interest in-depth.

 Keywords:
Environmental Perception, Environmental Impact, Technical Efficiency, Bounded Rationality, Environmental Decision-making

JEL Code:

D22, D24, I26, Q22, Q5

• Supervision