Marine shrimp agribusiness Brazi l • In YoNY SAMPA101, Ec10 DE FARIAS CosTA2, ERICA ALBUQUERQUE3 AND BRENO RAMOS SAMPAI04 The expansion of marine shrimp agribusiness in Brazil is characterized by high rates of expansion in production and exports (Rocha et al. 2004, Costa et al. 2004). This expansion resulted in a substantial job generation and absorption of the local population with little formal instruction (Costa and Sampaio 2003). It also caused a sizable Municipal tax i I Shrimp culture Demand of basic inputs Source: authors. --. Jodand income --. Supply of u n public i services C Quality p of life a Demand of I public G setvices D p effect on income. The effect of an increase in income in turn, caused a rise in municipal direct and indirect tax collection. The increase in income and jobs led to ample possibilities of increases in the consumption levels and well-being of the populations of these municipalities. Fig. 1. A model of marine shrimp cultivation impacts at the municipal level. This work is an attempt to analyze the socio-economic effects of marine shrimp culture in some selected municipalities in Brazil; specifically, those that influence employment, income and tax collection that shrimp culture generates in selected municipalities. An Impact Model of the Marine Shrimp Cultivation at the Municipal Level The impact model, presented in Figure 1, represents the net of causalities that bind shrimp cultivation to the quality of life in the municipality, taking into consideration the direct and indirect effect of the activity. However, it is also necessary to determine which impacts are retained in the municipality and which ones transcend it. Marine shrimp cultivation affects the municipal income and the quality of life of the population of direct and indirect form. In a direct way, it generates jobs and income, the income representing the addition of the expenditures made in the city. It contributes, also, to municipal taxes, directly for licenses and service occupation taxes and, indirectly, through state and federal transferences. It also impacts through input suppliers, located in the city, and processors and traders of shrimp production. Also, through induction, commerce is stimulated and, as a consequence, it demands products, hires personnel and pays taxes. The additional tax collection compensates for increased expenses 62 MARCH 2007 for the municipal government, integrating a new chain of multipliers of jobs and income. Finally, on the one hand, the employment and income direct, indirect and induced expansion, affects the demand for goods and services related to the improvement of the quality of life (housing, health services and education); on the other, it stimulates the expansion of services provided either by the public or the private sector. To analyze the impacts of shrimp cultivation some simplifications were adopted. It is assumed that consumption (C) is a function of income (Y) and that the direct taxes (Td) are a function of the municipal product: Td = Td (Y) . The transferences of the federal and state governments are also affected by the municipal production (added value, in the case of sales tax, for example). It is assumed that marine culture affects the municipal income (LiY) through direct payments, profits and the government budget. Adding the direct and indirect impacts on income, LiY is calculated. To estimate the income impact, the direct impacts are obtained by the incurred addition of the wage bill and other expenditures at the municipal level, and for the indirect impacts, they are obtained from a input-output matrix, in which only the values expended in the city are considered. The indirect impacts estimation present an upward bias, because in the chain of inter-relations, even the expenses
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