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Abstract
Shrimp production in Thailand has historically been undertaken in the saline
and brackish waters of coastal mangroves. In recent years rising demand and prices
for shrimp and falling productivity of mangrove areas have motivated an expansion of
shrimp production into the fresh-water margins of river estuaries that were previously
used for rice cultivation.
Generalised additive models, which offer a comprehensive approach to
regression analysis, are mainly used for empirical analysis, and model development
and specification for rice and shrimp production in this study. This paper presents a
brief introduction to generalised additive models, discusses how they are applied to
develop cost functions to satisfy the restriction of production theory, and describes a
comparative economic analysis of shrimp and rice production. A final result was
found that rice production is characterised by constant returns to scale, and shrimp
production by increasing returns to scale. On this basis it was concluded that shrimp
production will continue to expand in the fresh-water areas, displacing rice production
and exacerbating environmental problems.