Week 10: Fisheries Flashcards
Describe the Gordon Schaefer Model?
Based on the size of fish population and growth rate.
Purpose of the model was to capture the effect of fishing on fish population.
- Bioeconomic model – used biological and economic factors.
Static model: ignors time dimension.
Population is measured at biomass (weight) à thus does not disinguish between number of individauls, size or age of fish.
From S to S*, population growth rate increases, small population size to available resources.
As S*à Sbar, population growth decreases, as larger population size relative to available resources.
Minimum viable population
- The point at which population growth rate turns negative
Carrying capacity
Where growth falls to zero.
How can we sustainably catch fish?
So long as the catch level equals the growth rate to the stock size, then the fish stock can be maintained.
Sustainable yield:
- The level at which the catch level = growth rate, S will remain the same.
Maximum Sustainable Yield (MSY):
The growth rate of population is maximised at S* (at which point, this will have the highest growth rate and catch level).
The cost model (i.e. fishing costs)
Measure fishing effort (in units)
- E.g. fishing hours, number of vessels, man-days etc.
- Primary assumption: the amount of fish caught per unit of effort is proportional to population size. à i.e. larger population, more fish caught per unit of effort (an increasing function of fish stock).
Cost of fishing effort: measured in $:
- Cost of running a boat (fuel, operating and labour costs)
Assumption 2: the marginal cost (per unit cost) of fishing effort is constant. I.e. each unit of fishing effort costs the same amount of money.
Benefits into the model:
Benefits of fishing (revenue): measured in $
- Money received for fish when sold
- Revenue = Quantity of catch * price
Assumption 3: Constant marginal benefit. The price of a unit of fish remains the same.
Benefits and Cost model:
Where is the net benefit (profit)?
Where do we find the maximum economic yield (MEY)
MEY is the amount of effort where net benefit (profit) is maximised.
- MSY would only coincide with MEY if the marginal cost of the effort was zero (i.e. total cost curve is horizontal)
In this case, lower levels of effort and larger fish population size than MSY.
REMEMBER, the curve for the population is reversed, when compared to benefits and cost.
What is the outcome if there is only one owner?
If you are the sole owner you will maximise profits. Therefore you will do E^e
When fish stocks are a private good
Will factor in future time periods.
What is the outcome in (open access) competitive?
No single fisherman can prevent other from exploiting the fishery.
(common good):
- Will increase catch levels until benefit = total costs.
Increase to E^C
Outcome of competition:
- No incentive to ‘save’ the resource for future time periods
- If the fisherman does not catch the fish today, someone else will catch it.
- Cannot secure future profits, thus only consider current profits.
- Rational market participants will exploit the resource, as no incentive to retain long term asset value.
- Ultimately – reduces future profits.
In addition:
- Too much effort is spent on too little fish.
- Fewer vessels could be employed, increase current profit.
- More fishermen increase total cost, but not total revenue
- At E^C no new entrants as no profit to be made (‘rent dissipation’)
Which outcome do we prefer?
Maximum sustainable yield is prefered.
What are the market failures in the fish market?
3 ones.
Inappropriate government intervention:
Negative Externalities:
Improperly defined property rights
How is Inappropriate government intervention a market failure?
Goal of policy has been to help fisherman, not an environmental concern.
- Not to recover and maintain fish stocks, but to ensure fishermen profit.
E.g. credits and subsidies for bigger boats
How does the fish market display negative externalities?
Bycatch
- Catching other wildlife
- Sea birds, turtles, dolphins, other fish species
Impact on habitat
- Trawling and dynamite fishing
- Pollution of fish nets
Changing the composition of ecosystem
Changing the balance of species can lead to reprecussions along the food chain.
What impact does technology innovation have on sole owner fisheries?
New technologies lower the marginal cost of effort:
- This results in the cost curve rotating to the right (becoming flattened)
Consequence:
- Increase in total effort
- Lower stock size
- Larger catch size
- Higher net benefit for the fishery.
What are the policy reactions to technology?
Restrictions placed on fisheries (i.e. fishing effort) to increase their cost of production.
- Increase in cost of effort (rotation to the left)
Example:
- Restriction of equipment use:
- Pacific salmon will spawn by swimming upstream
- Restriction on barricades and traps (increases cost of fishing)
- Restrictions on location and time
- Restricted to a few hours a day
E.g. 4 hours in Prince William Sound
Comparison between ITQs, TURFs, CPRs
