Transaction Costs and Institutional Innovation: Sustainability of Tank Aquaculture in Sri Lanka

Freshwater community-based aquaculture was introduce to village irrigation tanks in the dry zones of Sri Lanka in order to off-set the limited supply of animal protein available to residents in inland areas. This paper examines transaction costs associated with the management of community-based aquaculture in Anuradhapura district, the most important inland fish production area in the country. The study suggests that sustainability of community-based aquaculture depends on successes in experimenting with institutional arrangements that can minimize transaction costs and achieve adequate returns to participants through productivity gains from tanks. [SANDEE Working Paper 18]