The increase in commercial fisheries production over the last 50 years has been accompanied by an increase in the level of incidental catch and discarding of a number of speices. Approximately one-quarter of the marine commercial catch destined for human consumption is discarded at sea. This has aroused the concern of a number of groups in society, including environmentalists, humanitarians and fisheries themselves. This paper examines the economic incentives to discard fish as well as the effects of different management policies on these incentives. The concept of an optimal level of discarding of discussed taking into account the externalities that can be created by discarding. Finally, the paper reviews the effectiveness of various measurestechnical, administrative and economicto reduce the level of discarding.'