Continuous Harvesting Costs in Sole-Owner Fisheries with Increasing Marginal Returns

37 Pages Posted: 29 Oct 2009

See all articles by Jose M. Maroto

Jose M. Maroto

Universidad Complutense de Madrid (UCM)

Manuel Moran

Universidad Complutense de Madrid (UCM)

Leif Kristoffer Sandal

Norwegian School of Economics (NHH) - Department of Business and Management Science

Stein Ivar Steinshamn

Norwegian School of Economics (NHH) - Department of Business and Management Science

Date Written: September 15, 2009

Abstract

We develop a bioeconomic model to analyze a sole-owner fishery with fixed costs as well as a continuous cost function for the generalized Cobb-Douglas production function with increasing marginal returns to effort level. On the basis of data from the North Sea herring fishery, we analyze the consequences of the combined effects of increasing marginal returns and fixed costs. We find that regardless of the magnitude of the fixed costs, cyclical policies can be optimal instead of the optimal steady state equilibrium advocated in much of the existing literature. We also show that the risk of stock collapse increases significantly with increasing fixed costs as this implies higher period cycles which is a quite counterintuitive result as higher costs usually are considered to have a conservative effect on resources.

Keywords: Bioeconomic modelling, Stock collapse, Fixed costs, Pulse fishing, Cyclical dynamics, Increasing marginal returns

Suggested Citation

Maroto, Jose M. and Moran, Manuel and Sandal, Leif Kristoffer and Steinshamn, Stein Ivar, Continuous Harvesting Costs in Sole-Owner Fisheries with Increasing Marginal Returns (September 15, 2009). NHH Dept. of Finance & Management Science Discussion Paper No. 2009/6. Available at SSRN: https://ssrn.com/abstract=1496316 or http://dx.doi.org/10.2139/ssrn.1496316

Jose M. Maroto

Universidad Complutense de Madrid (UCM) ( email )

Carretera de Humera s/n
Madrid, Madrid 28223
Spain

HOME PAGE: http://www.ucm.es/info/eiop/profesores.php?id=maroto

Manuel Moran

Universidad Complutense de Madrid (UCM) ( email )

Carretera de Humera s/n
Madrid, Madrid 28223
Spain

HOME PAGE: http://www.ucm.es/info/anaeco/html/manuel.htm

Leif Kristoffer Sandal (Contact Author)

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway
+47 55 95 93 41 (Phone)

Stein Ivar Steinshamn

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
40
Abstract Views
680
PlumX Metrics