Aquaculture-Fisheries Interactions

In this paper, I investigate aquaculture externalities on fisheries, affecting either habitat, wild fish stock genetics, or fishing efficiency under open-access and rent-maximising fisheries. This is done with a Verhulst-Schaefer model of fish population-dynamics and production, coupled with a simple aquaculture production model. Externalities are modelled by letting carrying capacity, the stock’s intrinsic growth rate, or catchability coefficient in the fishery depend on aquaculture production. The different externalities can give totally opposite results on steady-state fishing effort, yield, and stock, even for only negative externalities. With a catchability externality, increased unit cost of fishing effort implies reduced aquaculture production to maximise benefits to society under reasonable assumptions. Resource allocation between the industries is analysed under three different coastal management regimes: 1) aquaculture has a primary right of use; 2) joint management of aquaculture and fishery; 3) fishers have a primary right of use, including the right to sell marine farming rights.Aquaculture, fisheries, externality, interactions, carrying capacity, intrinsic growth rate, catchability coefficient, habitat, genetics., Environmental Economics and Policy, International Relations/Trade, Public Economics, Q22, R52,

THE OPTIMAL ALLOCATION OF OCEAN SPACE: AQUACULTURE AND WILD-HARVEST FISHERIES

A significant problem hindering the emergence or the continued growth of aquaculture in many marine areas is the conflict that arises among it and other ocean uses. We develop a framework to clarify the choice of the optimal scale of aquaculture when that use impacts a commercial fishery. We identify a range of potential impacts, both positive and negative, and analyze how one or more might affect the carrying capacity of a fish stock. We conduct a numerical simulation to illustrate a case where aquaculture and fishery uses interact in the ocean and compete in the product market, and we find that an ocean area could be devoted exclusively to aquaculture. This result depends strongly upon assumptions about the nature of the interaction, the geographic distribution of fish, and the aquaculture production technology. We also investigate the behavior of the model when both uses are able to coexist.Resource /Energy Economics and Policy,

Fisheries policies impacts consideration towards the development of rural coastal areas

The current study aims to examine the effectiveness of fisheries policies and specifically of the Greek Operational Programme for Fisheries, 2007-13. In specific, aims to examine and assess possible impacts generated, in the regional economy of Voreio and Notio Aigaio from its four axis, with particularity to the forth one. For this a regional Input-Output model was built in order to capture direct and indirect impacts in terms of output, employment and income. Results indicate that the dynamics of the fisheries sector in the regional economy are very weak and along with the continuous shrinking of the sector, leads to the necessity of supporting alternative vocational activities for the development of coastal rural areas. Though, results indicate that the funds attributed to such policies are very small, resulting in very weak generated impacts in the regional economy. And thus it is not expected current policies to seriously affect the development of such regions through the promotion of alternative to fishing activities.rural coastal areas, operational fisheries programme, impact analysis, regional analysis, Community/Rural/Urban Development, R11, R15, R58, Q22,

Evergreen Leasing of Aquaculture Sites

Government policy on siting of aquaculture must balance the objective of providing a long planning horizon for the industry against a broader social interest of adapting lease terms to new environmental information. Evergreen leases are proposed to balance these objectives. Under an evergreen lease, the lease renewal occurs not at the end of the lease, but rather at midterm. For example, a 20-year lease might be renewed at year five or year 10. The mid-term renewal process avoids end-point biases and also creates incentives for the two parties to successfully bargain a renewal. Evergreen leases are an appropriate institution when two parties want a long-term relationship but recognize that terms of the relationship must evolve to reflect new information.aquaculture, evergreen leases, Resource /Energy Economics and Policy, Q22,

Evaluating the demand for aquaculture insurance: An investigation of fish farmers' willingness to pay in central coastal areas in China

Despite the remarkable development in its fishery sector, the penetration rate of fishery insurance in China is considerably low. This paper examines the key factors that contribute to the poor performance of fishery insurance, in particular aquaculture insurance, in China. The double-bounded dichotomous choice contingent valuation method (DB DCCVM) is used to investigate fish farmers’ willingness to pay (WTP) for an insurance program, based on a survey of 1280 fish farmers in three coastal cities in China. The results indicate that fish farmers’ decisions on adoption of an insurance scheme depend on various factors, among which magnitude of loss, fish farmers’ awareness toward insurance and their education all have a positive impact. However, income and farming years are more likely to have a negative effect. In addition, the mean WTP for aquaculture insurance is estimated to be CNY 579 (US$ 90.05) 2 per household, which is equivalent to 1.5% of fish farmers' mean annual income. These results provide several policy implications for not only the Chinese government but also researchers as well as insurance companies

TURFs and ITQs: Collective vs. Individual Decision Making

While most of the attention in the scientific and policy literature on rights-based institutions has been devoted to Individual Transferable Quotas (ITQs), there are alternatives that involve different configurations of use rights. One such alternative is a space-based option commonly referred to as Territorial Use Rights Fisheries (TURFs). TURFs have been utilized in island fisheries off Southeast Asia for decades, and they have been well studied, particularly by anthropologists and sociologists. This paper discusses case studies of TURF organizations in Japan and Chile from an economics perspective. We discuss the historical origins of each system, outline the legal and institutional structures of the systems, and then discuss how each system manages nearshore coastal resources. We discuss similarities and differences across the many specific collective management structures adopted by Japanese and Chilean TURF organizations. We then discuss how outcomes differ from what might emerge under ITQs.Collective management, resource management, rights-based fishery management, TURFs, Environmental Economics and Policy, International Relations/Trade, Q22,

An analysis of the fish pool market in the context of seasonality and stochastic convenience yield

On the basis of a popular two-factor approach applied in commodity markets, we develop a model featuring seasonality and study futures contracts written on fresh farmed salmon, which have been actively traded at the Fish Pool market in Norway since 2006. The model is estimated by means of Kalman filtering, using a rich data set of contracts with different maturities traded at Fish Pool between 01/01/2010 and 24/04/2014. The results are then discussed in the context of other commodity markets, specifically live cattle, which is a substitute. We show that the seasonally adjusted model proposed in this article describes the behavior of salmon price very well. More importantly we show that seasonality exists in the salmon futures market. This is highly important in pricing of contingent claims, designing hedging strategies, and making real investment decisions in marine resources

When a Fish is a Fish: The Economic Impacts of Escaped Farmed Fish

The escape of cultured fish from a marine aquaculture facility is a type of biological invasion that may lead to a variety of potential ecological and economic effects on native fish. This paper develops a general invasive species impact model to capture explicitly both the ecological and economic effects of invasive species, especially escaped farmed fish, on native stocks and harvests. First, the possible effects of escaped farmed fish on the growth and stock size of a native fish are examined. Next, a bioeconomic model to analyze changes in yield, benefit distribution, and overall profitability is constructed. Different harvesting scenarios, such as commercial, recreational, and joint commercial and recreational fishing, are explored. The model is illustrated by a case study of the interaction between native and farmed Atlantic salmon in Norway. The results suggest that both the harvest and profitability of a native fish stock may decline after an invasion, but the total profits from the harvest of both native and farmed stocks may increase or decrease, depending on the strength of the ecological and economic parameters.

Derby Fisheries, Individual Quotas, and Transition in the Fish Processing Industry

Processors adapt to the pulse of landings in derby fisheries by investing in large-scale facilities capable of preserving and storing fish products. In fisheries where the pulse of landings suppresses the ability of processors to meet consumer demand for fresh product, the imposition of individual quota (IQ) systems transforms the associated fish processing industry. The cost of fresh fish processing is generally lower and more malleable than that for preserved fish, and consumers may pay a price premium for fresh product, which creates an opportunity for entry by fresh-fish processors and results in higher equilibrium ex-vessel prices. Incumbent firms are likely to experience an economic dislocation due to a diminished value of nonmalleable capital used to preserve and store fish products. Our paper generalizes and provides a modeling framework for the observed changes in the British Columbian halibut harvester/processor industry complex following the introduction of an IQ system.Derby fishery, individual quotas, pulse of landings, fish processing, fresh fish, preserved fish, product forms, ex-vessel price, wholesale fish price, processing capital, malleability, Resource /Energy Economics and Policy, Q13, Q22,

Efficiency Advantages of Grandfathering in Rights-Based Fisheries Management

We show that grandfathering fishing rights to local users or recognizing first possessions is more dynamically efficient than auctions of such rights. It is often argued that auctions allocate rights to the highest-valued users and thereby maximize resource rents. We counter that rents are not fixed in situ, but rather depend additionally upon the innovation, investment, and collective actions of fishers, who discover and enhance stocks and convert them into valuable goods and services. Our analysis shows how grandfathering increases rents by raising expected rates of return for investment, lowering the cost of capital, and providing incentives for collective action.Fishing rights, property rights, allocating fishing rights, grandfathering fishing rights, auctions of fishing rights, fisheries rent