What's the Fishery Production Function? Implications for Fishery Policy Evaluation.

• Environmental and Resource Economics Workshop

Date and Location

Friday, November 2, 2012, 12:10 PM - 1:30 PM
ARE Conference Room, 2102 Social Sciences and Humanities

Abstract

Forecasting the impacts of policy interventions requires that the underlying structure used for prediction remains constant in different policy environments. In this presentation, I investigate whether the conventional approach to modeling the fishery production function is invariant to policy changes and thus valid for predicting the impacts of transitioning to rights-based managed systems in fisheries. The appropriateness of rights-based management for multi-species fisheries ultimately depends on a fisherman's ability to "target" their optimal catch composition. Previous ex ante examinations of targeting ability suggest that rights-based systems may face serious challenges due to weak substitution potential between species. In contrast, ex post evidence from multi-species ITQ fisheries suggest that far greater flexibility in outputs is possible than previously thought. These disparate findings suggest that the production technology revealed through empirical work may be heavily dependent on current management policies. Through a simulation exercise and an empirical investigation of the Bering Sea groundfish trawl fishery, I provide evidence that the conventional approach to modeling fishery production does not identify policy invariant parameters, and thus, is limited in its use for predicting the impacts of policy interventions.